The Jupiter token debate has reopened an old question in crypto: Can buybacks work if supply continues to rise?
Summary
- Large buybacks struggled to offset the rapid growth of JUP’s circulating supply.
- Ongoing unlock schedules provided steady selling pressure on the token.
- Industry voices argue that longer-term capital strategies may work better than short-term buybacks.
Jupiter’s buyback plan was never large enough to keep pace with the amount of new JUP coming onto the market.
The discussion picked up again in early January following comments from Jupiter (JUP) co-founder Siong Ong, followed by a explanation by Anatoly Yakovenko, co-founder of Solana (SOL), which sparked a broader debate on whether token buybacks make sense in high-issuance crypto models.
A buyback overwhelmed by unlocks
Using about half of the fees from the protocol, Jupiter spent more than $70 million to buy back JUP by 2025. On paper, the effort seemed significant. Jupiter processed billions of transactions and remained one of Solana’s most active decentralized finance platforms.
Price action told a different story. In early January 2026, JUP was trading around $0.20-$0.22, down almost 89% from its peak. The reason was not a lack of stock market activity, but the pace of supply growth.
Since launch, JUP’s circulating supply has increased by approximately 150%, while the buyback program has only offset a small portion of the newly unlocked tokens. Unlocks still happen on a fixed schedule.
Approximately 53 million JUP will be unlocked each month through June 2026, providing consistent selling pressure regardless of protocol performance.
In this situation, the buybacks function as a short-term buffer rather than a long-term support. Recognizing this fact, Ong argued that it would be inefficient to continue allocating capital to buybacks, and instead proposed a shift in focus to growth incentives.
Why Yakovenko says buybacks are falling short
Yakovenko put the issue in simpler terms. In heavy-issue markets, short-term buybacks don’t change the way sellers assess risk. Tokens unlocked today will be sold at today’s price, not at a future value implied by continued buybacks.
Protocols should actually stash the cash for a future buyback. This would force all the unlocks to trade at the future expected post buyback price. https://t.co/aLsFkgmDd7
— toly 🇺🇸 (@toly) January 4, 2026
His alternative focused on time. Instead of immediate redemptions, protocols can accumulate profits and stake them later, or offer staking programs with longer lock-ups. This forces unlocks to be valued at a future post-buyback environment rather than spot demand.
It also encourages investors to think in longer cycles, similar to the way balance sheets are built in traditional finance. The reaction in the Jupiter community has been mixed.
Some see buybacks as necessary for discipline and alignment. Others agree that they lose impact if supply expansion is so aggressive.
Jupiter has already adjusted its course by reducing its planned airdrop in 2026, reducing its allocation from JUP 700 million to JUP 200 million. The lesson is harder to ignore. In token models where unlocks dominate, buybacks alone rarely change the outcome.
