Jito (JTO): an overview of the token of the leading liquid-stacking protocol based on Solana

Emerging in late 2020, right before the decentralized finance (DeFi) boom, the liquid-stacking market now leads the entire segment in terms of the value of assets blocked in protocols (TVL), which amounts to $61.4 billion according to DeFi Llama data as of December 2024. By comparison, the combined TVL of all credit protocols in the DeFi market is $49.6 billion, and DEX exchanges only $25.9 billion.

What is Jito?

Jito Network is a decentralized liquid steaking protocol launched on the Solana blockchain in December 2023. It combines liquid staking and maximum extractable value (MEV), a strategy for including, excluding, or reordering transactions in the waiting queue when creating a new block.

Jito Network is the first DeFi protocol in the Solana ecosystem in terms of total blockchain value (TVL), which is $2.8 billion as of December 2024. According to the DeFi Llama monitoring service, Jito Network is third among all platforms in this segment after Lido and Binance Staked ETH.

Only last year, Jito Network's TVL grew more than 4.5 times from $624 million. By this indicator, Jito Network even surpasses the leading Solana ecosystem decentralized exchange Jupiter, TVL of which reaches $2.4 billion.

How does Jito work?

Liquidity-stacking protocols such as Jito Network allow you to reuse your assets and profit more than if you were simply storing or adding to liquidity pools on decentralized exchanges (DEXes) or lending platforms (lending).

It works this way:

• A user deposits Solana (SOL) cryptocurrency into Jito Network's steaking pool;
• In return, Jito Network generates an equivalent number of liquid steaking tokens (LST) called JitoSOL and transfers them to the wallet of the owner of the staked SOLs.

It can be said that JitoSOL LST tokens are a kind of depositary receipt. In other words, to get back his SOL tokens, the investor needs to return JitoSOL tokens to the Jito Network protocol and burn them. This approach is much more convenient and more straightforward compared to classic steaking and serves as an alternative to it, but it has two crucial advantages:

1. There is no lockout period, which means that the speaker does not have to wait for the lock-in period to end to retrieve his tokens from the steaking pool. However, with classic Solana token steaking, the lock-in period varies from 2 to 30 days.
2. Simplified stacking process. Users do not need to select a validator or restack SOL tokens to other node operators if necessary.

The resulting JitoSOL tokens can be used in the same way as any other tokens (except for management functions), such as:

• Add to DEX exchanges' liquidity pools to generate revenue from trading commissions;
• Use as collateral to obtain credit in other cryptocurrencies;
• Exchange on exchanges for other tokens.

The Jito token and its role

Like many DeFi protocols, including liquid staking, Jito Network has its token. JTO is Jito Network's native management token, which is used to vote for suggestions to improve the protocol.

For example, JTO token holders can vote for:

• The amount of fees for various transactions within the Jito Network protocol (particularly for the steaking pool);
• Changes to developer funds and distribution of rewards;
• Application of updates related to the Jito Network user interface (e.g., implementation of new protocol features);
• Changes to the code of the Jito Network protocol and other key products of its team (e.g., StakeNet);

JTO tokens were initially distributed in an airdrop held by the Jito Foundation in December 2023 to active community members. The team distributed 100 million JTO tokens during the airdrop.

As of December 2024, just over 274 million JTOs were circulating on the market, and the maximum number of Jito tokens is 1 billion. At the same time, as stated on the CoinMarketCap website, JTO tokens have no-issuance cap, which means that this altcoin is an inflationary asset. If additional units are issued, it could create extra pressure on Jito's price.

Since listing on exchanges in December 2023, the value of the JTO token has increased by 95% from $2.39 to $3.26 as of December 2024. Moreover, the historical high (ATH) of the JTO price was recorded in April 2024 at $5.28, almost 40% of the current rate.

JTO's market capitalization is $882 million, and based on this indicator, the token ranks 109th in the overall CoinMarketCap ranking and second in the liquid staking segment after Lido DAO (LDO).

Conclusion

JTO is one of the key tokens in the liquid steaking segment, and if its positive trend continues, the token will hold great promise in the future. However, since the Jito Network protocol is centered on the Solana ecosystem, JTO's future success is equally closely tied to its demand and momentum.