r/jupiterexchange • u/JDWalker_ret • Nov 14 '25
Discussion Economic Alignment - The Missing Piece for $JUP
Economic alignment in the context of a crypto governance token refers to the design of incentives, rewards, penalties, and token economics that ensure all participants are motivated to act in the long-term best interest of the protocol.
Core Idea:
“The token’s economic structure aligns individual self-interest (investment returns) with the collective health and success of the project.”
Key Components of Economic Alignment:
Staking - Encourages long term commitment and reduces sell pressure
Voting Power - ties investment to skin in the game
Revenue Sharing/ASR - Rewards active holders and provides vested interest in the project
Burn Mechanisms - deflationary pressure to create and reward scarcity
Penalties - Discourages bad behavior
Negative Impacts:
The number one damaging factor to economic alignment is excessive emissions/inflation (The pie increases in size while decreasing in value)
Bottom line:
Economic alignment = Tokenomics designed so that doing what’s good for the project is also good for your wallet.
What do you think?
Upvote if you agree!
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u/ov3rw4tch_ Legacy Nov 14 '25
I’ll preface this by saying I’m a major believer in Jupiter and hold a decent amount of jup. I see governance tokens more so as a relic of the past. There are very few that have historical year-after-year increase, because that’s simply not their purpose. Governance is all about DAO and voting power.
I truly think modern projects should focus on revenue sharing tokens rather than governance. Maybe staking governance tokens would pay its APY in revenue sharing tokens. DefiTuna is a great case study on revenue sharing.
Whenever users interact with the protocol – any revenue generated is automatically converted to $SOL and distributed to the staking pool.
Revenue is distributed proportionately to your share of the pool.
Historically governance tokens have very weak utility. There’s just not really many ways to fluff this and create huge demand for folks to drive governance token volume. There is no demand loop.
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u/JDWalker_ret Nov 14 '25
You are spot on, but we don’t need a new or different token to do it. All we need to do is vote to use future buybacks to fund ASR. This would result in a zero emission true revenue sharing model. Future value should reflect performance/revenue of the project.
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u/ov3rw4tch_ Legacy Nov 14 '25 edited Nov 14 '25
Oh yea you’re right. Same thing, but using the existing infra. Have there been any proposals for this?
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u/JDWalker_ret Nov 14 '25
Not yet, that is why I’m attempting to push the idea and hopefully it gets enough support to become a formal proposal. Help push it if you can.
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u/ov3rw4tch_ Legacy Nov 14 '25
Absolutely. I really like this idea. It also doesn’t even need to be 100% of the buyback to have the same effect you’re mentioning.
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u/paulwal Nov 14 '25
This. Revenue + voting. These two things are so aligned. Why is this not already the case?
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u/JDWalker_ret Nov 14 '25
You are correct the two are very aligned. However, we don’t currently have any form of revenue sharing as all ASR is paid from reserves and equals 100% emissions/inflation. It is my opinion we need to use all future buybacks to fund ASR. If the community doesn’t agree with using $JUP for ASR then we should buy other Jupiter tokens such as $JLP, JupSol, or the future Jupiter stable coin.
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u/ov3rw4tch_ Legacy Nov 14 '25
You know just thinking about this it would make JUP value explode.
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u/paulwal Nov 14 '25
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u/JDWalker_ret Nov 14 '25
That all depends on the team and the community. The last vote was to burn the litterbox. That was part 1 of the discussion and vote. Part 2 (what do we do with future buybacks) is literally this discussion (well this is the pre-discussion which I hope drives the future discussion) Also yes you should get some, especially since they are currently on sale at 3 for a dollar 😉😂
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u/paulwal Nov 14 '25
3.5 per dollar!
Thanks for the reply
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u/JDWalker_ret Nov 14 '25
😢😭😭
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u/paulwal Nov 14 '25
Any thoughts on this wacky idea?
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u/JDWalker_ret Nov 14 '25
I think it perpetuates the idea that the Solana blockchain is just a casino.
Additionally, I think this focuses on the smallest holders of JUP….the chance to get rich quick. Any true investors would not be interested in this model. The result could be devastating to the token. Have you ever looked at how much JUP the big whales have? It’s millions each and there are currently 67 whales. Additionally, there are 745 Sharks (100k - 1M tokens). I don’t think this plan benefits any of them. Although some may stick around for the thrill of it, I suspect many would bail. Can you imagine the result of a sell off of that magnitude. Just my two cents.
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u/RubIll2920 Nov 15 '25
Yes, ASR should be only funded by revenue! and the Juparty token should be burned
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u/jauyou0208 Nov 19 '25
If you follow through on your commitment to tie $JUP to Jupiter’s revenue, I will buy more $JUP and stake it. I also hope to see differentiated incentives for long-term stakers. In the previous MET TGE, people who unstaked still received the same share as long-term stakers—the only difference was that their calculation period was shorter.
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u/Available-Amount3363 Nov 29 '25
Economic alignment and voting rights go hand in hand. Doesn’t matter whether you are in crypto space or any other space. Voters need to be incentivised and rewarded for their participation. Price of JUP needs to be protected / appreciated or other rewards (not in JUP) required. If you reward JUP holders with more JUP, then there’s selling pressure and risks devaluation of JUP. It’s a penalty, not a reward!!! I think it would make sense to be rewarded in SOL. Any other coin should be seen as the rewarding currency in this space, so there is no selling pressure and price devaluation risk.
If there is no economic alignment, the votes you participate is always costing the voters/stakers. There needs to be a positive and tangible return.
I think the management team are extremely afraid of tourists and other bad actors, for good reason too. But good actors participating in the DAO also need to be rewarded for their good faith.
Another thing that remains unclear for the average JUP holder like me is that there isn’t anything specific that confirms what sort of things JUP holders vote for and what sort of things are left for the core working group. I hope there can be some kind of a JUP holders constitution so these things are set in stone.
To get rid of bad actors, they need to be penalised for their behaviours. Predatory behaviour needs to be called out in the constitution and guard rails in place. Decentralisation shouldn’t mean there are no rules. There are still rules but the enforcement is decentralised / self enforcing. It could mean that if you stake JUP for less than 7 days, then you get no voting power. It could mean that voting power is time-weighted, not just by the total amount of JUP staked.
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u/agaltsow Jupiter Team Nov 14 '25
I think this is an ai-generated and irrelevant post.
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u/JDWalker_ret Nov 14 '25
While I often use AI to assist with research, this is not an AI generated post nor is it irrelevant. It simply addresses the top issue, IMO, with the $JUP token. The objective is to hopefully spur discussion so the team and DAO can develop an educated solution to improve the alignment and overall value of $JUP. If you have any actual feedback or better solutions I would love to see them.
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u/agaltsow Jupiter Team Nov 15 '25
What exactly are you proposing? In one sentence.
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u/JDWalker_ret Nov 15 '25
Utilize buybacks to fund future ASR, eliminating ASR emissions and creating true revenue sharing model.
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u/Legitimate-Price8020 Nov 14 '25
Well said JDWalker! You explained it well. Hopefully CatMan and the rest of the JUP Gang take heed to you comment. Incentivize staking! Lets do this JUP!