Jupiter DAO votes to cut Jupuary airdrops as JUP stalls near its all-time lows

Jupiter DAO has opened the vote on imposing zero emissions for $JUP tokens. The main goal is to remove the Jupuary event and avoid further token dilution under worsening market conditions.

Jupiter DAO is preparing to alter its emission schedule, breaking away from its approach to Jupuary airdrops. The vote will end on February 22 and may cause a significant shift in the protocol.

As Cryptopolitan reported earlier, Jupuary has been under scrutiny for months, as market conditions kept stagnating even for the best-performing protocols.

$JUP remained range-bound despite a brief recovery in the past week, ahead of the zero net emissions vote on canceling Jupuary. | Source: Coingecko

According to Jupiter’s team, $JUP is the token used as an alignment engine between the team, the community, as well as holders and stakers. The big problem is that $JUP has fallen over the years, and now hovers at $0.16, near the bottom of its range.

$JUP still reacted to the potential for zero new emissions by climbing to a one-week local high.

Jupiter DAO faces two options for $JUP

The proposal focuses on a breakaway from the current practice of $JUP airdrops by proposing zero net emissions.

The vote offers two options: to continue with Jupuary or to adopt a new zero net emission schedule.

If Jupuary is preserved, Jupiter DAO will bring out the airdrop checker a week after the vote, followed by a 200M $JUP distribution. The remaining bonus pools and Jupnet incentives will continue on their own schedule.

The alternative option will include a larger reorganization of $JUP tokenomics. The platform will postpone Jupuary and return the prepared 700M tokens to the Community Cold Multisig wallet. The initial airdrop snapshot will remain valid for future use.

In addition to canceling the airdrop, Jupiter will also have to stop team token emissions indefinitely, while accelerating Mercurial vesting. The goal is to also absorb sell pressure by buying back some of the newly released $JUP.

Jupiter tokenomics uses cliff vesting, which has the potential to put greater pressure on the market. The new proposal will greatly alter the predicted unlocks and potentially affect the $JUP price.

Community still calls for airdrops

Airdrops remain one of the few incentives for ongoing loyalty to crypto protocols. Jupuary was part of the Jupiter DAO promises, which kept the Jupiter community together. The events were widely presented as positives during a 2024 vote, which ushered in two instead of one Jupuary events.

The contentious issue is that the Jupiter team will still receive their $JUP rewards from Mercurial vesting, which also leads to significant dilution. Cutting out Jupuary is thus perceived as preserving team perks while cutting out rewards for the community.

Airdrop mining has continued, but in the past months, the potential earnings from those events have been minimal. While Solana projects continue to produce significant fees, users have complained that the value of airdrops does not even offset the fees spent on trading or other on-chain activities.

Abandoning community rewards may further hurt the incentives for on-chain participation, while questioning the real utility of protocols. Jupiter produces $839M in annualized fees, and its community rewards will be much lower without Jupuary.