Outside Source
Jito, a Solana-based liquid staking protocol, kicked off a long-awaited airdrop event that distributed 90 million JTO governance tokens to users.
Valued at approximately $165 million at the time, the Jito (JTO) airdrop rewards users for staking and lending the protocol’s liquid SOL token, JitoSOL.
Analysts speculate the wealth effect could provide a stimulus for broader Solana adoption.
Jito lets users stake Solana in exchange for JitoSOL, a liquid token that can be freely traded or used as collateral in defi protocols.
Along with competitor Marinade, Jito makes up one of Solana’s largest liquid staking platforms, each boasting around $425 million in total value locked (TVL), according to DefiLlama data. For context, the dominant liquid staking protocol, Lido, has accumulated a TVL of $21.45 billion on Ethereum (ETH).
The airdropped JTO token will govern Jito’s newly formed DAO and manage its substantial $490 million treasury. The token allocation was based on a points system tied to JitoSOL balances and lending activity. According to Blockworks Research’s Dan Smith, as cited in a recent article, moving just $40 of JitoSOL could have earned users up to $10,000 in JTO.
The move mirrors other high-profile airdrops like Uniswap’s $900 million UNI token drop in 2020. Dubbed a “stimulus check” by analyst Ryan Watkins, the wealth effect from UNI may have boosted development in DeFi. Similarly, some believe Jito’s airdrop could reinvigorate interest in Solana as it recovers from the FTX fallout.
There are signs of renewal across Solana’s ecosystem. Its NFT volume is improving and DEXes like Solanart and Raydium processed a record $7.3 billion in volume last month. Meanwhile, new projects like Jupiter Protocol plan additional token distributions to incentivize growth further.
Airdrop recipients have an 18-month claim window, possibly allowing them to defer taxes until 2024, according to Blockworks’ Ryan West. Despite this, over half the supply was claimed just hours into distribution. Further, top token holders appear to be keeping their holdings, showing confidence in Jito’s future.
With Solana bouncing back and activity heating up across trading, NFTs, and DeFi, the JTO airdrop could provide added momentum for Solana. The wealth effect may stimulate broader adoption and development much like Uniswap’s UNI token did for DeFi. As such, the event marks an important milestone for both Jito and Solana’s path to mainstream usage.
This article first appeared at crypto.news
