Jupiter’s token debate has reopened an old question in crypto: can buybacks work when supply keeps rising?
Summary
- Large buybacks struggled to offset rapid growth in JUP’s circulating supply.
- Ongoing unlock schedules kept steady sell pressure on the token.
- Industry voices argue longer-term capital strategies may work better than short-term repurchases.
Jupiter’s buyback plan was never large enough to keep pace with the amount of new JUP entering the market.
The discussion picked up again in early January after comments from Jupiter (JUP) co-founder Siong Ong, followed by an explanation from Solana (SOL) co-founder Anatoly Yakovenko, which triggered a wider debate over whether token buybacks make sense in high-emission crypto models.
A buyback overwhelmed by unlocks
Using about half of the protocol’s fee revenue, Jupiter spent over $70 million in 2025 to repurchase JUP. The effort appeared significant on paper. Jupiter processed billions of transactions and remained one of Solana’s most active decentralized finance platforms.
Price action told a different story. By early January 2026, JUP was trading near $0.20–$0.22, down close to 89% from its peak. The reason was not a lack of activity on the exchange, but the pace of supply growth.
Since launch, JUP’s circulating supply has increased by about 150%, while the buyback program has offset only a small fraction of newly unlocked tokens. Unlocks still happen on a set timetable.
Through June 2026, about 53 million JUP are scheduled to unlock each month, adding consistent sell pressure regardless of protocol performance.
In this situation, the buybacks function more as a short-term buffer than as a long-term support. Ong acknowledged this fact and argued that it would be inefficient to continue allocating capital to buybacks, proposing a shift in focus to growth incentives instead.
Why Yakovenko says buybacks fall short
Yakovenko framed the issue in simpler terms. In markets with heavy emissions, short-term buybacks do not reset how sellers price risk. Tokens unlocked today are sold at today’s price, not at some future value implied by ongoing repurchases.
His alternative focused on time. Rather than buying back immediately, protocols could accumulate profits and deploy them later, or offer staking programs with longer lockups. Doing so forces unlocks to be valued against a future, post-buyback environment instead of spot demand.
It also encourages holders to think in longer cycles, similar to how balance sheets are built in traditional finance. The reaction across the Jupiter community has been mixed.
Some see buybacks as necessary for discipline and alignment. Others agree they lose impact when supply expansion is this aggressive.
Jupiter has already adjusted course by reducing its planned 2026 airdrop, cutting the allocation from 700 million to 200 million JUP. The lesson is harder to ignore. In token models where unlocks dominate, buybacks alone rarely change the outcome.
