Solana’s top swap venue seems immune to criticism

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No matter how crazy things get, Jupiter’s market share seems impenetrable for the time being. 

Last week, the swap aggregator and Solana DeFi everything app had two of its programs closed by an unauthorized user who gained access to its private key used for program deployments. 

User funds were safe, the engineer in charge of the programs disclosed on X, implying that he meant to make the program only upgradeable by multiple key signatures but didn’t get around to it in time. The programs have since been changed — they are now governed by a multisig that takes multiple keys to be opened. Having just one private key guarding programs with real users is a serious security mishap, and Jupiter is probably thanking its lucky stars that no funds were stolen.

But despite this, no one seemed to care much. One commenter chastised the Jupiter engineer for leaving the “keys in the ignition,” but otherwise, the oopsies was met with a collective shrug. 

On one hand, you could point out how near misses happen all the time in DeFi, and the space moves far too quickly for the crypto world to take stock of seeming minutiae like this. But the non-incident also perhaps points to something that doesn’t get talked about as much: Jupiter’s seemingly-uncrossable moat in Solana DeFi. 

Jupiter’s calling card is its swap function which algorithmically routes trades across various liquidity venues to execute swaps with the best possible prices for users. When I set up a test swap of PYUSD for JitoSOL, it first proposed to route the funds through Raydium then to Meteora and onto Orca before returning to my wallet. This product is widely-used in Solana DeFi, and it tends to outperform competitors. While writing this article, I set up a quick few different swaps on Jupiter and Phantom, and Jupiter gave me a better price every time.

Because of this product, Jupiter finds itself somewhat immune to controversy — for now. Around a month ago, Jupiter founder meow penned a mea culpa apologizing for poor user experience with things like gas fee estimation, adding that the Jupiter felt “quite hurt” that their products weren’t performing as intended.

But despite it all, there seems to be little negative impact on Jupiter. Its native token has traded essentially in tandem with SOL over the past few months. The platform has risen to become the third-largest in Solana DeFi by TVL, and it’s seen the most inflows over the past week of any Solana protocol with over $50 million — despite two of its programs being compromised.

Unless a better competitor emerges, Jupiter just seems to have a pretty good thing going on at the moment (though for what it’s worth, I made a similar case for pump.fun, which may finally be running out of steam). 

In the meantime, Jupiter is building out a host of other features as part of its utopian “grand unified marketplace” vision. There’s a lot of benefit to having one killer product prop up other lines of business. Amazon famously used its web services to bankroll its online marketplace for many years.

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