Jupiter DEX has announced a program to buy back JUP tokens using trading fees. The buybacks will begin on February 17 to help create a reserve and boost demand.
Buyback Details
Jupiter DEX intends to use 50% of all protocol fees to buy back JUP tokens, which will be locked for three years. This step is aimed at offsetting the recent selling pressure due to the January airdrop of JUP tokens. The buybacks will be conducted hourly and reported via a dedicated dashboard.
Impact on the Market
The buybacks are taking place following the burning of 3 billion JUP during the Catstanbul event, reducing the total supply to 7 billion tokens. Despite this, trading activity on the platform remains high, with plans to buy back up to $250,000 in JUP tokens. Currently, JUP is trading slightly above $0.83, at the lower end of its three-month range.
Jupiter's Strategic Plans
Jupiter plans to allocate 50% of the received fees for development, swapping them into SOL and USDC, while the remaining funds will be used for JUP buybacks. These assets will be managed through a team multisig wallet, and JUP will be locked in a new vault for three years. The primary goal of the buybacks and token burning is to reduce circulation and stabilize the price.
The buyback plans tighten the management of JUP's supply, which might lead to reduced selling pressure. This decision is backed by the successful activity of the DEX and the team's development efforts.
