This article introduces three projects worth long-term attention: Cow Protocol, Uniswap, and Jupiter.
Written by: Mint Ventures
In a previous article titled "Panning for Gold: Finding Long-term Investment Targets Through Bull and Bear Markets (2025 Edition Part 1)," we outlined and introduced several projects in the lending sector, including Aave, Morpho, Kamino, MakerDao, as well as staking projects like Lido and Jito. This article, as the middle part of a series, will continue to introduce projects with strong fundamentals that have long-term attention potential.
PS: This article reflects the authors' thoughts as of the publication date, which may change in the future. The views expressed are highly subjective and may contain errors in facts, data, or reasoning. All opinions in this article are not investment advice, and we welcome criticism and further discussion from peers and readers.
### 3. Trading Sector: Cow Protocol, Uniswap, Jupiter
3.1 Cow Protocol
Current Business Status
Products and Mechanisms
Cow Protocol is a decentralized trading aggregation protocol, with its core product being the decentralized trading aggregator CoW Swap. The "CoW" in the name stands for Coincidence of Wants, which means directly matching the needs of buyers and sellers through a matching mechanism. CoW Swap uses batch auction matching as a price discovery mechanism, aggregating users' trading intentions (order demands) and conducting unified clearing in each block.
This mechanism allows for direct matching of user orders without the need for traditional market makers or liquidity pools. When both parties want to exchange the assets they need, the transaction can be completed directly, avoiding intermediary fees. For parts that cannot be matched directly, CoW Swap routes the remaining orders to decentralized exchanges (DEX) or other aggregators to obtain liquidity. This design minimizes slippage and fees to the greatest extent and allows all trades executed in the same batch to share the same clearing price, eliminating price unfairness caused by the order of execution.
Additionally, CoW Swap introduces a Solver bidding mechanism: multiple third-party solvers compete to provide users with the best trade execution plan. The winner gains the right to execute that batch of trades and bears the on-chain gas fees. Users only need to sign their order intentions offline and do not need to pay on-chain transaction fees themselves; no transaction costs are incurred if the order is not executed. This "intention matching + solver bidding" model enhances user experience (no need to worry about gas losses from failed transactions) and provides a certain degree of MEV (Maximum Extractable Value) protection—since order matching occurs off-chain, solvers must bid to return MEV to users, making MEV attacks like front-running difficult to execute.
CoW Swap currently provides services on Ethereum, Arbitrum, Gnosis, and Base.
In addition to CoW Swap, another product of Cow Protocol is the MEV Blocker, developed in collaboration with partners like CoW DAO, Beaver Build, and Agnostic Relay. After users switch their wallet's RPC to MEV Blocker, their transactions will go through a private searcher network (instead of entering Ethereum's public mempool, which is visible to all searchers and susceptible to MEV attacks), preventing sandwich attacks and front-running attacks from the source.
- The regular transaction process on the Ethereum network involves: after a user initiates a transaction, it first enters the public mempool; searchers monitor the mempool for MEV opportunities and bundle the transactions; builders receive the bundles from searchers and construct blocks; validators receive the blocks from builders, verify them, and add them to the blockchain.
Revenue Model
Cow Protocol's revenue sources can be roughly divided into two categories:
- Revenue sharing from trading surplus (Surplus) generated by Cowswap. The so-called trading surplus refers to the money saved by Cowswap through its bidding network, providing users with more than the initial quote. Currently, Cowswap charges 50% of the trading surplus for most networks, but the fee does not exceed 1% of the transaction volume.
Additionally, for external protocols (partners) that integrate Cow Protocol, Cow Protocol takes 15% as a service fee from the trading fees generated by partners (the proportion can be customized but does not exceed 1% of the transaction volume).
Finally, Cow Protocol also charges a fee on the overall network trading volume for certain networks, such as Gnosis and Arbitrum, with the current fee rate being 0.1% of the transaction volume (excluding special trading pairs like stablecoins).
- Revenue generated from the MEV Blocker, from which Cow Protocol takes about 10% of the earnings obtained by validators through MEV Blocker.
In the composition of the protocol's revenue, most of the income comes from the trading surplus sharing of Cowswap, so the business data we will focus on later will primarily revolve around Cowswap.
Business Data
We will focus on two key business data points for Cow Protocol: trading volume and protocol revenue.
Trading Volume
Data Source: Dune
As an emerging intention matching protocol, CoW Swap has experienced rapid development over the past three years. In 2021, the protocol was still in its infancy, with relatively low trading volumes. Entering 2022-2023, Cow Protocol saw an increase in business data as the demand for MEV protection and efficient aggregated trading in the DeFi space grew. In 2024, the protocol's trading volume surged significantly: monthly trading volume reached a new high by the end of 2024, with nearly $7.8 billion in December 2024, and still around $6.9 billion in February 2025, far exceeding previous years' levels.
It is worth mentioning that CoW Swap has increasingly gained favor among DAO organizations and professional institutions for providing large, low-slippage trading solutions. In 2023, about one-third of the on-chain trading volume of DAOs was completed through CoW Swap, and by February of this year, this proportion rose to 79.5%.
Data Source: Dune
Protocol Revenue
Data Source: Dune
Entering 2024, Cow Protocol began actively exploring protocol revenue generation, conducting multiple rounds of revenue tests, and revenue has shown a steady upward trend month by month. January 2025 was the highest month for revenue (calculated in ETH), with a single-month protocol revenue of 641 ETH. Based on an average ETH price of $3,328, this amounts to approximately $2.13 million. In February, revenue was 586 ETH, with an average ETH price of $2,668, resulting in protocol revenue of about $1.56 million.
Protocol Incentives
Data Source: Tokenterminal
Currently, Cow Protocol's main expenditure is the Cow token incentives for the network solvers. Network solvers receive Cow token rewards based on the quality of the trading solutions they provide (the trading surplus offered to traders). According to Tokenterminal's statistics, the expenditure on Cow token rewards over the past year was approximately $7.4 million. In January and February 2025, the protocol's token incentives were $858,000 and $961,000, respectively, which is lower than the protocol revenues of $2.13 million and $1.56 million for the same months.
According to Cow Protocol's official disclosure of the 2024 project income and expenditure in January this year, without considering the development costs of the protocol, the expenditure on solver token rewards in 2024 is estimated to be around $5.2 million, while the total protocol revenue for the year is approximately $6 million, indicating that revenue has already surpassed token incentive expenditures.
Competitive Situation
Cow Protocol's main battleground is the decentralized trading aggregator sector. This sector was initially dominated by 1inch, but the landscape has begun to diversify in the past two years. According to the latest data from The Block in March 2025 (excluding UniswapX), 1inch's market share has dropped from the top position (on March 5, 1inch's Fusion feature was attacked, resulting in losses exceeding $5 million, exacerbating user concerns about its security) to only 22.8%, ranking second, while Cowswap has surpassed it with 33.85%, taking the top spot in monthly data for the first time.
Data Source: The Block
In addition to 1inch and CoW, the top five aggregators also include ParaSwap, 0xAPI/Matcha (the aggregation interface provided by the 0x protocol), as well as KyberSwap and Bebop. These competitors each hold around 10% or less of the market share, with ParaSwap and 0x having a longer history and stable user bases, while KyberSwap (which transitioned from Kyber Network to aggregation) and Bebop, launched by Wintermute, have recently gained a certain number of new users.
Overall, the competitive landscape in the DEX aggregation sector remains intense, with new players continuously emerging. Although Cow Protocol has become a new leader in this field, its position is not yet firmly established.
In addition to traditional aggregated trading products, two other noteworthy competing projects are Uniswap's UniswapX and the cross-chain trading platform UniversalX launched by Particle Network.
UniswapX
UniswapX is a cross-platform aggregation trading feature launched by the Uniswap team in the second half of 2023. Essentially, UniswapX provides users with a similar intention order + filler mechanism: users submit offline signed orders on the Uniswap frontend, and third-party "fillers" in the network (similar to the solver role in the Cow Protocol network) can take on the orders and trade on-chain for users.
The process involves fillers providing quotes and enjoying exclusive matching rights for a short period. If the transaction is not completed within the specified time, it enters a Dutch auction phase, allowing more fillers to participate in the bidding. This model shares similarities with the solver bidding in CoW Swap, both being off-chain matching and on-chain settlement solutions. With Uniswap's brand and large user base, UniswapX quickly integrated into its frontend interface and launched on the ETH network.
It is noteworthy that there was once industry skepticism regarding UniswapX "copying" the intention matching model of CoW Swap. Voices, including those from Curve's official team, pointed out that CoW Swap had already pioneered the solver model, and UniswapX was not the first to implement it. Despite the controversy, UniswapX has leveraged its positioning advantage within the Uniswap ecosystem to quickly gain considerable trading volume, reaching over 10% market share in the EVM aggregation trading market in early 2024 (at that time, Cowswap's share was about 14%). However, its market share has gradually declined; according to data disclosed by Cow Protocol in March this year, UniswapX's market share in aggregated trading is approximately 5.5%.
UniversalX
UniversalX is another highly anticipated new project focusing on cross-chain aggregated trading. Launched by Particle Network and set to go live on the mainnet by the end of 2024, its goal is to facilitate trading of any on-chain assets without the need for cross-chain bridges. Its core concept is "chain abstraction": users can deposit assets from multiple chains into a unified on-chain account and trade any chain's tokens using a unified balance on the UniversalX platform, which will automatically complete cross-chain exchanges and settlements in the background.
As a new entrant in the aggregator space, UniversalX targets the niche of cross-chain trading, differentiating itself from projects like Cow Protocol that primarily focus on single-chain aggregation. However, with the development of multi-chain ecosystems, UniversalX may face competition from Cow Protocol in the future if Cow Protocol expands to more chains or offers cross-chain functionality, entering UniversalX's competitive domain.
Competitive Advantages of Cow Protocol
In the face of fierce competition, Cow Protocol has been able to rise and grow steadily, and its competitive advantages can be analyzed from both product and brand perspectives:
1. Product
- Technical and Mechanism Advantages of Trading Products: Cow Swap is the first protocol to apply batch auction matching and solver competition to DEX aggregation, giving it a first-mover advantage. Its unique Coincidence of Wants direct matching mechanism allows transactions to be completed without traditional liquidity pools, reducing users' reliance on AMM pools and lowering slippage and fees. At the same time, the unified clearing price mechanism avoids price exploitation caused by transaction order, allowing heavy traders, especially institutional orders, to transact at fair prices.
In contrast, later entrants like UniswapX and 1inch Fusion have borrowed similar ideas but differ in specific implementations. For example, CoW Swap uses a sealed bidding process once per block, where all proposals are submitted simultaneously and executed based on quality, maximizing the compression of MEV space. This mechanism is considered more effective than UniswapX's time-limited exclusive filling and Dutch auction in preventing unfair practices like front-running.
- MEV Protection and Security: The dual product structure of Cow Protocol's trading service + MEV Blocker further enhances its resistance to MEV, extracting user transactions from Ethereum's public mempool and allowing trusted solvers to batch publish them on Ethereum, effectively reducing the risk of front-running and sandwich attacks. Additionally, the protocol imposes strict limits on the slippage of quotes and execution results from solvers, mechanically compressing the space for miners and searchers to extract MEV. These measures make Cow Swap one of the trading platforms most focused on user protection. For large transactions and DAO treasury managers, such MEV protection is highly attractive.
2. Brand
As the first trading product to launch batch auction matching and solver competition mechanisms, combined with its MEV-resistant product features, Cow Protocol's value proposition of safety and cost savings for traders has deeply resonated with users, gradually becoming the first choice for large traders, a position unlikely to change easily. This user habit is backed by the brand and reputation accumulated by Cow Protocol based on its product, which is also the source of the protocol's gradual profitability.
Monthly active users of 1inch over the past year, Data Source: Tokenterminal
Monthly active users of Cow Protocol over the past year, Data Source: Tokenterminal
Main Challenges and Risks
Intense Competitive Environment
The aggregation trading sector is highly competitive, with established projects like 1inch, Kyber, and DoDo, alongside new forces like Bebop, which is backed by Wintermute. Additionally, products like CEX and wallets, which are closer to users and possess strong entry and frontend advantages, as well as chain abstraction concept products like UniversalX, are actively exploring innovations in trading products and striving for higher user penetration. Over the long term, their relationship with Cow Protocol is more competitive than cooperative. Therefore, although Cow Protocol's market share has surpassed 1inch to become number one, maintaining that market share in such a high-pressure environment is not easy and will directly suppress the protocol's bargaining power with users and suppliers (solvers), creating a clear conflict between the goals of "market share" and "protocol profit."
Market Cycle
The overall downturn in the market cycle will lead to a shrinkage in total trading volume, impacting Cowswap's trading volume, which goes without saying. Other trading products are similarly affected, and this will not be elaborated further.
Binding with the EVM Ecosystem
Currently, Cow Protocol only provides services within the Ethereum ecosystem. If the Ethereum ecosystem does not develop as well as other public chains, it will naturally limit Cow Protocol's growth potential. The same risk applies to Uniswap, which will be mentioned later, and I will not repeat it.
Valuation Reference
COW Token
Cow currently has a total supply of 1 billion, with a circulating ratio of approximately 41.5% according to Coingecko data, and a token inflation rate of 19.61% over the next year.
Currently, the main use case for Cow tokens is governance. As protocol revenues rise in the future, there may be token buybacks, and there have been previous attempts to stake Cow to reduce transaction fees.
Valuation
From a vertical valuation perspective compared to itself, as business data continues to rise, Cow's FDV has reached a new high in this round (not considering the anomalies caused by the extremely low circulation rate in the first month after the project launched its token), with the highest market cap reaching a peak FDV of $990 million at the end of December last year, followed by a significant decline, currently around $280 million.
We compare Cow's PS value through the FDV and protocol revenue earnings multiple:
As shown in the above chart, although Cow's FDV has shown an upward trend over the past year, its PS value has exhibited a significant decline as business revenue has increased, making it more cost-effective than before.
From a horizontal comparison with competing products, 1inch is the most direct benchmark among comparable projects in the aggregator space. Considering that 1INCH currently does not have direct token value capture and the protocol does not have stable, public protocol revenue, we mainly compare the FDV and trading volume ratios of the two protocols.
As shown in the above chart, with the decline in Cow's price and the increase in business data, its market cap to trading volume ratio has fallen below that of 1inch for the first time since February 2025, offering a higher horizontal cost-effectiveness.
3.2 Uniswap
Current Business Status
Core Product
Uniswap is the largest decentralized exchange (DEX) on Ethereum, with its main products including its DEX protocol (now deployed on the Ethereum mainnet and several layer-2 networks) and the newly launched Unichain dedicated Layer 2 network.
The fee switch model of the Uniswap protocol has not yet been activated, so the protocol itself has not generated direct revenue in the past (but Uniswap Labs charges a 0.15% interface service fee on token trades on its official frontend).
However, following the official announcement of Unichain's launch in November 2024, it will subsequently distribute value directly to UNI holders through staking UNI to earn fees from transaction sorters, without needing to activate the fee switch.
Business Data
For Uniswap, the most important business data are trading volume and fees; for Unichain, we mainly focus on the number of active addresses on-chain, the main ecosystem, and the scale of funds on-chain.
DEX Trading Volume and Fees
Uniswap's trading volume and Fee, Source: tokenterminal
Overall, Uniswap's trading volume has continued to grow with the market's development, reaching historical monthly trading volume highs in March and December of the past year. However, recently, as the market has cooled, trading volume has noticeably declined.
It is worth noting that during this cycle, Uniswap's Fee metrics have not surpassed the peak and secondary peak of the previous cycle, indicating that the fee ratio has been decreasing as the cycle progresses, leading to intensified competition among LPs.
Multi-Chain Data
Thanks to multi-chain deployment (currently covering 11 EVM chains), especially with the launch of Base by Coinbase, Uniswap's number of active users reached a new high of 19 million in October last year. The growth rate of this business data far exceeds that of trading volume, demonstrating L2's capability in attracting new users.
Multi-chain distribution of Uniswap's monthly active addresses, Source: tokenterminal
Among them, Base is the main force of active users, accounting for 82% of Uniswap's active users across all chains.
Source: tokenterminal
However, in terms of trading volume, Ethereum remains Uniswap's main battlefield, accounting for about 62% of the trading volume, followed by Arbitrum at 23%, and then Base at 8.4%.
Source: tokenterminal
Business Data of Unichain
Since its official launch in early February this year, Unichain has seen rapid growth, with the number of weekly active addresses reaching nearly 120,000 by early March, ranking 7th among all L2s, surpassing well-known L2 projects like zksync, Manta, and Scroll.
Source: tokenterminal
However, the value of assets bridged to Unichain is still low, currently only around 14 million USD.
Source: tokenterminal
In terms of ecosystem, Unichain has officially listed over 80 ecosystem projects, although most of the actual businesses have not yet been officially launched. For example, in DeFi, aside from Uniswap itself, the only well-known application currently live is Venus (with total deposits of 5.67 million USD).
Competitive Situation
Uniswap has still maintained its leading position in the DEX market of the EVM ecosystem over the past year, with an overall market share still in first place, but the overall trend of market share continues to decline. The following chart shows the market share trends of all DEXs in the EVM ecosystem (including all EVM L1s and L2s).
Source: Dune
The second place is Pancakeswap, and the third is Aerodrome, which are the leading DEXs on Bnbchain and Base, respectively (although Uniswap has also deployed on these two chains).
Source: Dune
ETH, Bnbchain, and Base are also the three chains with the largest trading volumes in the EVM ecosystem, consistent with the market share rankings of Uniswap, Pancake, and Aerodrome.
As for Unichain, due to its short launch time, its ecosystem is still relatively weak and is in the cold start phase for applications and funds. Aside from a good growth in active user numbers, other business data still show a significant gap compared to mainstream L2s.
Uniswap's Competitive Advantages
Uniswap's competitive advantages can be summarized as follows:
1. Network Effects and Liquidity Depth
The largest liquidity pools attract the most traders, and vice versa. More traders and trading volume attract more tokens to deploy liquidity here, creating a self-reinforcing cycle.
2. Brand and User Habit Stickiness
As the first project to promote the AMM model in the DeFi space, Uniswap has the highest brand recognition (including awareness and legitimacy) and reputation. It holds a strong mental position in the minds of both traders and liquidity providers. Even in today's rich landscape of DEXs and various aggregators, many users habitually trade on Uniswap's frontend, even if it incurs an additional trading fee. Uniswap's brand has also played an important role in its L2 development, attracting many quality projects for testing and participation right from the launch of L2, leading to rapid user growth.
3. Ecological Positioning through Multi-Chain Deployment
Uniswap has deployed products on most mainstream EVM chains and ranks among the top three in trading volume on most of these chains. This not only helps Uniswap maintain its foundational position in the multi-chain era but also lays the groundwork for its future multi-chain aggregation trading capabilities, making it easier to achieve interoperability of multi-chain liquidity.
Main Challenges and Risks
Intense Competitive Landscape and Disruption from New Models
Although Uniswap still holds a certain advantage in market share, its traditional Ethereum competitors like Curve continue to hold their ground. On the other hand, Uniswap's breakthroughs on other EVM L1s and L2s have not been smooth, as each chain has its own strong local competitors (such as Pancake on Bnbchain, Aerodrome on Base, and Camelot on Arbitrum).
More concerning is the challenge posed by various emerging trading models: RFQ protocols (Request-For-Quote) and batch auction matching models are on the rise. Projects like CowSwap allow market makers (solvers) to quote directly, improving price efficiency for large trades and reducing AMM slippage and MEV, which are favored by professional traders and whales, significantly diverting Uniswap's trading volume.
Although Uniswap later launched UniswapX, which employs a similar mechanism, it has not been able to slow down the growth of projects like Cowswap. Additionally, products like wallets and CEXs, which have clear frontend advantages, are also intensifying their efforts in trading scenarios, attempting to penetrate upstream user behavior, leaving Uniswap in a more passive position as a "price taker" in the face of fierce pricing competition.
Inefficient Community Governance and Lack of Value Linkage for Tokens
Long-term observers of the Uniswap governance forum will mostly find that compared to other DeFi projects with higher governance efficiency and better reputations (like Aave), Uniswap's governance efficiency is very low, specifically reflected in slow speed, resource waste, and insufficient focus on strategic metrics.
For specific examples:
The community's most concerned issue regarding the fee switch has been discussed repeatedly for nearly three years, with no results to date;
Various donations and budgets have been provided to research and organizations that are not closely related to Uniswap's North Star metric (trading volume), but the results have been minimal in benefiting the project.
The low level of community governance, along with the neglect and procrastination regarding the value linkage of UNI tokens, clearly has a long-term negative impact on the price of UNI tokens.
Valuation Reference
Since Uniswap has not yet generated formal protocol revenue, and the fees from Unichain are negligible relative to its market cap, we use the ratio of Uniswap's market cap to its fees (PF) for both vertical and horizontal valuation comparisons.
Source: tokenterminal
In vertical comparison, Uniswap's PF in February this year was 6.77, at an absolute historical low. Since the issuance of Uniswap's token, there have only been three months with lower values for this metric, specifically May-June 2022 (Three Arrows Capital collapse) and April 2024 (altcoin market correction + Uniswap receiving SEC's Wells Notice). In March, this metric slightly rose to 7.26. From this metric, it is evident that the market currently feels extremely pessimistic about the prospects of UNI tokens.
Source: tokenterminal
For horizontal comparison, I chose other DEX projects, specifically Pancake and Aerodrome, which are the second and third in market share after Uniswap. I did not choose Curve because, in addition to being a DEX, it also has a primary business in lending, making it less comparable to the top three.
From the PF metrics of the three, it seems that Uniswap's valuation is significantly higher than that of Pancake and Aerodrome. However, we also need to consider two additional factors:
Uniswap has not implemented any token subsidies, while Pancake and Aerodrome are still conducting substantial token subsidies, especially Aerodrome, which had token incentives worth up to 27 million USD in February (see the chart below).
Uniswap also has Unichain as a second growth curve. Uniswap's multi-chain ecosystem is better developed; although Pancake has also deployed on multiple chains, its operational performance shows a significant gap compared to Uniswap, while Aerodrome is a single-chain DEX.
Overall, even considering the similarities between Uniswap and Pancake and Aerodrome's businesses, the horizontal valuation comparison of their PF is weaker than the vertical comparison.
3.3 Jupiter
Business Status
Starting from aggregated trading, Jupiter has expanded its product offerings and acquisitions, forming a full-chain layout around trading on the Solana chain, and has horizontally expanded to other chains and ecosystems. The main products within the Jupiter system include:
- Main site self-operated trading products: This includes aggregated trading (Instant), market orders (Trigger), and conditional orders (Recurring), which were the earliest products launched by Jupiter and are also the most used. The daily trading volume set a record of 57 million transactions on January 20.
Source: Dune
The main site's Trenches product, previously known as Ape.pro, is a specific product tool for memes, consistent with typical meme trading tools like Phonton/GMGN. However, by the end of February, after Ape.pro was merged into Trenches, its product form became quite similar to Jupiter's aggregated trading product.
The main site's Perps product has a core product logic similar to GMX, offering leveraged long and short positions on BTC, ETH, and SOL, as well as yield farming. This segment's TVL peaked over 2 billion USD, making it a major component of Jupiter's TVL. During peak periods, the average daily trading volume approached 1 billion USD, serving as Jupiter's primary cash flow business.
TVL (left axis) and trading volume (right axis) data of Jupiter's derivatives exchange. Source: DeFillama
The above can be considered Jupiter's main products. In addition, the Jupiter system includes the following products:
- Meme trading platform Moonshot: In January 2025, Jupiter announced the acquisition of a majority stake in the meme trading platform Moonshot. Moonshot has emerged as a standout meme trading platform in the past six months, attracting numerous users with its smooth fiat deposit system and simple trading process, generating a coin listing effect on Moonshot, especially when TRUMP was launched.
Moonshot's trading volume (left axis) and fees (right axis). Source: Dune
Liquidity platform Meteora: Meteora was founded by an early co-founder of Jupiter (Ben Chow). Although there is no clear control relationship with Jupiter, it is also regarded as an important part of the Jupiter ecosystem. However, Meteora will later issue its own token, and although it belongs to the Jupiter ecosystem, its relationship with the JUP token is somewhat indirect.
LST product jupSOL: Launched in 2024, jupSOL quickly captured a significant market share, currently ranking fourth after jitoSOL, bnSOL, and mSOL.
Market share of Solana LST (the gray block above represents jupSOL). Source: Dune
Launchpad LFG: In addition to the JUP token itself, LFG has launched governance tokens for the cross-chain communication protocol zeus (ZEUS), the LST protocol Sanctum (CLOUD), and the cross-chain protocol debridge (DBR), as well as several other meme projects in 2024. Although the number of launched projects is small, their quality is relatively high.
Portfolio management platform Jupiter Portfolio: In January of this year, Jupiter officially announced the acquisition of the on-chain portfolio tracker Sonarwatch and launched Jupiter Portfolio on January 30. The mobile wallet Jupiter Mobile was introduced after acquiring Solana's mobile wallet Ultimate Wallet.
Full-chain network Jupnet: Launched at the end of January this year, it aims to achieve a single account access to all chains, currencies, and goods, although there is currently no directly experienceable version targeting end users. The trading terminal Coinhall was acquired by Jupiter in September 2024, primarily providing trading for Cosmos ecosystem tokens. Through the acquisition of Coinhall, Jupiter gained the ability to build its own trading terminal, which is essential for the development of its Trenches product.
Currently, on-chain trading of Cosmos ecosystem tokens is not frequent, with daily trading volumes below 10 million USD.
Source: Coinhall
In addition to the aforementioned C-end products, Jupiter has many other initiatives, such as acquiring Solana's browser SolanaFM. They also have many products in the pipeline, such as the full-chain network Jupnet.
From the product layout perspective, Jupiter, as the largest C-end traffic entry point for Solana, covers almost all business directions except lending. Even in the very obvious "mixed operation" situation of Solana, Jupiter's business reach remains the most extensive. Moreover, in addition to self-operated businesses, they are also expanding their business boundaries through relatively aggressive acquisitions.
Profit Model
Currently, Jupiter's fee-based businesses include:
Aggregated trading business (including Trenches) charges 0.05%-0.1%, market orders and DCA charge 0.1%, and the derivatives business follows GMX's mechanism, with the main fees coming from a 0.06% fee charged at the opening and closing of positions, along with lending fees, price impact fees, etc. However, not all fees from derivatives go to JupiterDAO; 75% of the fees are distributed to its liquidity providers (JLP), while the remaining 25% is collected by JupiterDAO. Other businesses do not charge fees.
Token Incentives
Jupiter does not have a daily token incentive program; its main incentives come from two rounds of retroactive airdrops.
Competitive Situation
Trading is the core service provided by Jupiter, and other businesses like LST, Launchpad, and wallets can be seen as a re-utilization of traffic brought by trading. Therefore, we mainly analyze Jupiter's competitive situation in aggregated trading and derivatives trading.
Aggregated Trading
In the competition for trading entry points on Solana, Jupiter quickly surpassed Orca and Raydium in the first half of 2024, thanks to the aggregator's multi-liquidity pool routing features and excellent user experience, achieving an absolute advantage (51% of Solana's trading sources in Q2 2024, Source: Messari).
However, with the rise of meme and Pump.fun, specialized meme trading tools like Photon, Trojan, Bullx, and GMGN quickly encroached on Jupiter's market share at the trading entry level. They emphasize faster trading speeds and more comprehensive meme trading support features, becoming more recognized in the market as "Meme trading entry points." Jupiter launched a similar tool, ape.pro, in October last year, but the market response was lukewarm, and it was eventually merged into the main site's Trenches product. This is reflected in the data, as Jupiter's share of Solana's trading sources dropped to 38% in Q5 2024 (Source: Messari).
During the meme trading boom, meme trading accounted for 90% of Solana's network trading volume, and the division of the meme trading entry point is the biggest challenge Jupiter faces in aggregated trading.
Derivatives Trading
Jupiter's derivatives exchange is currently the second-largest derivatives exchange across all chains, with trading volume only surpassed by Hyperliquid, which will be introduced in the next section. Specifically on the Solana chain, Jupiter has a clear advantage over its main competitor Drift, with its trading volume recently being approximately 5-10 times that of Drift.
7-day derivatives exchange trading volume ranking. Source: DeFillama
In terms of DAU, the gap between the two has also approached an order of magnitude in the past month.
Data Source: Dune
In the field of derivatives trading, Jupiter's position on the Solana network is unlikely to be shaken in the short term.
Major Challenges and Risks
Although Jupnet has been launched to expand the full-chain business, Jupiter's current core business is still on Solana. For Jupiter, the biggest unknown is whether the Solana network can maintain its prosperity and keep active on-chain trading.
In addition to the previously mentioned challenges of unfavorable competition in the meme trading entry, Jupiter also faces other challenges and risks:
Overly Aggressive Business Expansion with Questionable Results
Jupiter's business expansion is much more aggressive than that of most Web3 projects. They have grand business ideas and have frequently expanded their business boundaries through acquisitions over the past year. However, many of these acquisitions have not achieved the expected results, such as the acquisitions of Moonshot and Coinhall.
Compared to the peak daily trading volume of 660 million USD and millions in revenue at the time of acquisition in January, Moonshot's daily trading volume has now sharply decreased to less than 5 million USD, with revenue not exceeding 10,000 USD. Although Jupiter has not disclosed the acquisition price and costs, it is clear that acquiring Moonshot today would come at a much lower cost for JUP token holders.
Moonshot's trading volume (left axis) and fees (right axis). Source: Dune
The acquisition of Coinhall helped Jupiter establish the capability for its meme trading product Trenches. However, based on the current situation, the Trenches product still has a significant gap in both trading volume and visibility compared to leading meme trading products like Photon, Bullx, Trojan, and GMGN.
No Self-Built Liquidity Pool
Jupiter does not have its own liquidity pool. Its supported Meteora has already launched a points program and is expected to initiate an independent token issuance process, which means that JupiterDAO or the JUP token cannot capture the trading fees from "tokens traded in liquidity pools." This portion of fees supported Raydium's business revenue exceeding 22 million USD in January this year.
Untested in Bear Markets
In bear markets, many logics that were taken for granted in bull markets can be broken. For example, currently, meme trading users on the Solana chain generally have a strong willingness to pay, and they hardly react to Jupiter's aggregated trading fee of 0.05%, as competing meme tools charge fees of 0.5% to even 1%. However, in a bear market, as trading enthusiasm wanes, users' sensitivity to trading fees will increase, and Jupiter may find itself caught in a conflict between "market share" and "net profit."
Additionally, Jupiter's current product line includes wallets, the full-chain network Jupnet, portfolio management tools like Jupiter Portfolio, and other businesses that are unlikely to generate revenue in the short term. Whether it can maintain such a large product line in a bear market is also a significant question.
Valuation Reference
The total supply of JUP is 10 billion, with 3 billion tokens voted to be burned at the end of January this year. Currently, the maximum circulating tokens are 7 billion, with an actual circulation of 2.63 billion, resulting in a current circulation ratio of 38.5%. Among the currently uncirculated tokens, 810 million team tokens will be gradually unlocked over the next 21 months, and an additional 700 million tokens will be released in next year's Jupiter airdrop. The inflation rate for the coming year exceeds 40%, and JUP still belongs to the category of low circulation and high inflation tokens.
Current distribution of JUP tokens. Source: Jupiter Governance Forum
At the end of January, Jupiter announced that 50% of protocol revenue would be used to repurchase JUP, with the repurchased JUP locked for 3 years.
The following chart shows the Jupiter protocol revenue statistics since October of last year, as compiled by DeFillama (note that the statistics for Jupiter's aggregator revenue on February 10 and March 10 may contain anomalies, but the author has not found other data sources for Jupiter's revenue statistics). It can be seen that Jupiter's main revenue currently still comes from derivatives trading (blue bars), which is certainly related to the significant decline in meme trading enthusiasm when Jupiter's aggregator fees were launched.
_Data Source: DeFillama
Since Jupiter just completed a significant economic model update at the end of January, charging 0.05%-0.1% for aggregated trading, the more relevant P/S data is from February and March.
According to the revenue data collected by DeFillama, Jupiter's revenue in February was 31.7 million USD, with an annualized revenue of 380 million USD, corresponding to a P/S (circulating) of only 3.65, and a P/S (fully diluted) of 9.5; while the revenue for March up to the 18th was 12.25 million USD, translating to an annualized revenue of 253 million USD, corresponding to a P/S (circulating) of 5.45, and a P/S (fully diluted) of 14.15.
Source: DeFillama
Whether compared horizontally with Cowswap mentioned earlier or vertically with Jupiter itself, JUP's current valuation appears to be relatively low.
Of course, all the above data is based on the hype surrounding Solana. As the popularity of Solana further declines in the future bear market, maintaining such high revenue will be very challenging, and we have already seen this trend in the data from March compared to February.
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