Jito DAO, the governing body behind Solana’s leading liquid staking platform, is proposing a major allocation of its treasury towards liquidity mining incentives.
The move, aimed at boosting the liquidity and utility of its native JTO token, involves a potential $29 million investment.
This marks a significant development in the DAO’s governance, highlighting the strategic importance of liquidity mining in the rapidly evolving DeFi landscape.
The proposal has ignited discussions within the community and underscores the growing prominence of incentive-driven strategies within the decentralised finance ecosystem.
Jito DAO Liquidity Mining Plan
Jito DAO, a decentralised autonomous organisation operating on the Solana blockchain, is actively considering a proposal to allocate a significant portion of its treasury towards liquidity mining.
Source: Jito DAO
The proposal suggests directing $29 Million, representing 3.1% of the 240 million JTO tokens held by the DAO, to incentivise liquidity providers and enhance the platform’s position in the liquid staking sector.
This ambitious proposal was meticulously crafted by Gauntlet, a reputable DeFi research firm recognised for its expertise in the blockchain space.
Having recently departed from Aave’s DAO, Gauntlet now sets its sights on Jito, offering valuable insights to optimise the platform’s incentive programs.
The firm’s analysis emphasises the necessity for Jito to increase spending on incentives to maintain its dominant position and fend off rival liquid staking providers on Solana, such as Marinade and Blaze.
Jito currently holds the distinction of being the largest liquid staking service on Solana by total value locked (TVL), according to data from DeFiLlama.
However, the platform’s recent growth spurt was partly attributed to a points system that has since concluded, and Jito’s spending on incentives has been minimal since then.
This proposal seeks to address this gap and reignite growth through a renewed focus on incentivising participation in its liquidity pools.
The proposed initiative would entrust the allocated funds to a committee composed of three members from the Jito Foundation and two members from Jito Labs.
This collaborative approach aims to ensure prudent management and effective allocation of resources.
The proposal is currently open for community feedback, and a 30-day review period is required before it can be formally submitted to the DAO’s voting platform for final approval.
The community’s response to this proposal will be crucial in determining the future trajectory of Jito DAO’s liquidity mining endeavours.
What is Jito DAO?
Jito DAO is the governing body of Jito Network, a significant contributor to the Solana ecosystem.
Known for its JitoSOL liquid staking pool and MEV (maximal extractable value) products, Jito has seen substantial growth and activity in 2024.
At the core of Jito Network is JitoSOL, a liquid staking token that allows users to earn staking rewards while maintaining liquidity and access to DeFi opportunities. This product has been a major driver of Jito’s success, attracting a significant amount of SOL to its staking pool.
In addition to JitoSOL, Jito Network offers various MEV products, providing traders with opportunities to profit from the order of transaction execution on Solana. This focus on MEV extraction and its fair distribution is a unique aspect of Jito’s contribution to the Solana ecosystem.
Jito DAO, as the governance mechanism of Jito Network, plays a crucial role in shaping its future. JTO token holders participate in key decision-making processes, such as setting fees for JitoSOL, updating delegation strategies, and managing the DAO’s treasury.
In 2024, Jito DAO has been actively processing proposals. While the exact number of processed proposals isn’t publicly available, the DAO’s governance platform shows a history of numerous completed proposals, including decisions related to adding and removing council members, updating wallet rules, setting liquidity mining budgets, and adjusting various parameters within the Jito ecosystem.
This active governance demonstrates the DAO’s commitment to the ongoing development and improvement of Jito’s protocols and products.
It also reflects the active participation of JTO token holders in shaping the future of Jito Network.
The proposal mentioned above is part of Jito DAO’s role to govern the whole ecosystem. While the budget seems a bit heavy, it is up to the community whether they would approve it or decline it in the next coming days.
