Solana protocol Jupiter will airdrop tokens to nearly 1m wallets — and it’s just the beginning

Airdrop announcements from Jupiter and Pyth Network helped boost activity on Solana along with a 163% run of the blockchain’s native SOL token since the start of October.

And now, the anticipation heightens as Jupiter divulges specific details about the token distribution in the first of its four planned airdrops.

Ming Ng, a member of Raccoons Labs, the group that created Jupiter, disclosed yesterday how the project will allocate the first 1 billion of the 4 billion tokens it plans to give away.

Approximately 2,000 power users, who had previously conducted trades worth $1 million on Jupiter, could each potentially secure more than 100,000 tokens, Ng said.

Smaller traders won’t be left out. 955,000 wallets that interacted with Jupiter before the November 2 cutoff are eligible to receive tokens in the initial distribution.

Jupiter is an exchange aggregator on Solana. It helps users swap tokens by finding the best trading prices across Solana’s many decentralised exchanges.

The project had earlier revealed its plan to introduce a token and distribute 40% of its supply to users during the Solana Breakpoint conference held in Amsterdam from October 31 to November 3.

Jupiter’s token supply is capped at 10 billion.

More airdrops on the way

In its first airdrop, Jupiter will distribute 200 million tokens evenly across all 955,000 eligible wallets.

Next, 700 million tokens will be allocated based on trading volume and activity, favouring users who traded larger amounts and more consistently.

Ng estimated that any user who traded more than $1,000 worth of tokens should receive some tokens from this bucket. However, those who registered higher trading volumes should enter higher allocation tiers and receive substantially more tokens.

“This approach ensures that anyone who used Jupiter actively, particularly in 2023, will likely see their activity reflected in the various tiers,” Ng said.

Finally, an additional 100 million tokens will go to active community members on Discord, X, and developer contributors.

Those who didn’t qualify for the first airdrop will get another shot. Jupiter will conduct three more airdrops, each distributing another 1 billion tokens.

Another crypto project, another airdrop

Airdrops have long been used as a way to market and grow DeFi protocols. Distributing governance tokens, which give holders voting rights in a protocol’s decentralised autonomous organisation — or DAO — can help make sure a protocol is sufficiently decentralised.

Many protocols commit to decentralised ownership structure to align themselves with the guiding ethos of decentralisation in crypto.

Uniswap was the first major DeFi protocol to airdrop tokens to its users in 2020. Just this year, Ethereum layer 2 Arbitrum, NFT marketplace Blur and modular blockchain Celestia have all airdropped tokens.

But projects that plan airdrops have a common problem to deal with.

Many crypto users attempt to game airdrop distribution systems by registering activity across multiple wallets, a practice known as Sybil attacking. This is usually bad for projects trying to distribute tokens evenly because those who game the system receive outsized allocations of tokens.

One Sybil attacker who spoke to DL News in May claims to have made over $10 million doing so since 2020.

Jupiter doesn’t seem concerned that its upcoming airdrop has been gamed, though.

“We have never announced or even hinted at any form of airdrop or even token until a couple of days pre-breakpoint,” Ng said. “There was no massive increase in wallets in those few days, so there’s no reason to think that we were massively spammed.”

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips at tim@dlnews.com.