In a recent note from Kairos Research, a cryptocurrency researcher, it was reported that Solana staking pool Jito clocked monthly revenue from priority fees and tips of more than $100 million in November and December. This impressive achievement is a testament to the growing popularity of the Solana network and the rising earnings of validators from prioritizing certain transactions over others.
Jito’s Growing Tip Revenue Reflects Solana Network’s Surging Popularity
According to Kairos, Jito’s validators scaled tip revenues by an average of 32% each month in 2024. Monthly income peaked in November at about $210 million. This significant increase in revenue from tips highlights the growing demand for transactions on the Solana network and the increasing importance of prioritizing certain transactions.
Maximum Extractable Value (MEV) and Its Impact on Validators’ Earnings
Jito’s growing tip revenue also flags validators’ rising earnings from prioritizing certain transactions over others, a practice known as Maximum Extractable Value (MEV). MEV refers to the difference between the best possible price for a transaction and its actual execution price. By prioritizing certain transactions, users can ensure that their transactions are properly executed but also contribute to higher transaction costs.
Solana Validators Earning More from MEV than Ethereum’s
For the first time in 2024, Solana’s validators earned more from MEV than Ethereum’s. This coincided with transaction fees on the Solana network nearly tripling from about 60,000 Solana (SOL) per day in January to more than 150,000 in October, according to data from Dune Analytics.
Jito’s Software Usage Dominates Solana Validators
As of Dec. 26, upward of 93% of Solana validators use Jito’s software to maximize earnings from block-building, according to developer, Jito Labs. This widespread adoption of Jito’s software is a testament to the growing importance of MEV in the Solana ecosystem.
Average Transaction Fees per Day on Solana
Below is a graph showing the average transaction fees per day on Solana:
| Month | Average Transaction Fees (SOL) |
| — | — |
| January 2024 | 60,000 |
| October 2024 | 150,000 |
Source: Dune Analytics
Liquid Restaking and Jito’s LRT Token
Jito, which also issues liquid restaking token (LRT) JitoSOL, has emerged as Solana’s most popular decentralized finance (DeFi) protocol, with nearly $2.75 billion in total value locked, according to DefiLlama.
What is Liquid Restaking?
Restaking involves taking a token that has already been staked — posted as collateral with a validator in exchange for rewards — and using it to simultaneously secure other protocols. LRTs represent a tradable claim on a pool of restaked assets.
Jito’s Governance Token, JTO, and Distribution of Tip Revenue
In October, holders of Jito’s governance token, JTO, voted to distribute a portion of tip revenue to JitoSOL restakers. According to Kairos, Jito plans to route 0.15% of tip revenue to JitoSOL restakers.
Validators’ Income from Tips
As of Dec. 26, Jito touts yields of about 8.6% for JitoSOL restakers. Validators will continue to pocket an overwhelming majority of income from tips.
Ethereum Continues to Dominate Staking and Restaking TVL
Despite Solana’s growing popularity, Ethereum continues to dominate staking and restaking TVL, with top restaking protocol EigenLayer commanding nearly $15 billion, according to DefiLlama.
Conclusion
In conclusion, Jito’s impressive revenue from priority fees and tips is a testament to the growing popularity of the Solana network. The increasing importance of MEV in the Solana ecosystem highlights the need for validators to maximize their earnings from prioritizing certain transactions over others. As the demand for transactions on the Solana network continues to grow, we can expect to see even more impressive revenue figures from Jito and other Solana staking pools.
