Jito Proposal Seeks New $JTO Utility and Greater Economic Security For Stakers

Jito, a Solana infrastructure provider and the network’s largest staking operator by TVL, has announced a governance proposal focused on providing $JTO staking rewards and improved economic security.

If passed, JIP-10 (Jito Improvement Proposal) will add a secondary source of economic security, decentralizing the process of Jito Tip distribution and adding value and utility to the $JTO token.

What is JIP-10, and how could it benefit $JTO and the wider Jito protocol?

The JIP-10 Proposal

Submitted by MetaDAO founder Proph3t, JIP-10 was born from the community’s motivation to increase the economic security of the Tiprouter NCN (Node Consensus Network), the process by which Jito Tips are distributed through the ecosystem.

The value of collected Jito Tips has increased significantly since the Tiprouter NCN was created. According to the proposal, the value of Jito Tips has doubled since October.

Proph3t argues “With the increased value at risk in the last month and potential further growth, additional layers of security are justified”.

By adding staked $JTO to the Tiprouter NCN, Proph3t claims Tiprouter security will be improved in the following ways:

• Bolstered TVL - Attackers will require significantly more capital if they wish control a supermajority of stake and exploit the protocol.

• Staking Diversification - Attackers would also be required to acquire large amounts of $JTO, which helps to diversify the TVL away from the value of LSTs alone.

Beyond reinforcing Jito’s economic security, the proposal also introduces staking rewards for $JTO, the protocol’s native governance token. This development would transform $JTO into a yield-bearing asset, giving it greater utility and incentives.

If the proposal passes, the new $JTO Vault will earn a 15bps fee from the total 3% Tiprouter NCN fees accrued via Jito tips. Collectively, the $JitoSOL Vault and $JTO Vault would each earn 15bps of fees with the remaining 2.7% transferred to the Jito DAO Treasury, as indicated by the proposal’s supporting diagram. 

JIP-10 will be subject to a 30-day discussion period, allowing community members to deliberate over potential outcomes. After this period, Jito DAO will have 5-days to vote on the proposal, with a final being put to a final MetaDAO decision market.

What Could This Mean For $JTO?

$JTO holders have largely reacted positively to the proposal, believing that any added utility to the asset is positive for the protocol. 

Asymmetric founder Joe McCann has championed the proposal, declaring $JTO to be “criminally undervalued”.

$JTO has been performing well since the proposal went live. The asset has surged 20.3% within 24-hours, rising from $3.00 to currently exchange hands at $3.61 based on Step Finance data. However, this is more likely due to bullish dynamics and sentiment across crypto markets than based specifically on an approved governance proposal.

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