Jupiter Perps is more than just another leveraged trading platform; it’s a novel approach to how perpetuals should function in a low-latency, high-efficiency on-chain context. It runs on Solana, replaces old oracles, streamlines execution, and employs an LP-based liquidity model to keep the market deep while minimizing volatility.
At its core, Jupiter Perps relies on a liquidity pool made up of SOL, ETH, WBTC, USDC, and USDT. Liquidity providers earn fees by holding JLP (Jupiter Liquidity Provider token), which traders can acquire via Jupiter Swap. The system finds the cheapest way to get JLP, whether through asset swaps, direct deposits, or market purchases. JLP holders not only earn an APR from trading fees but can also use their holdings as collateral in lending protocols like Kamino.
How Trading Works
Jupiter Perps lets traders open leveraged positions by posting collateral and borrowing from the liquidity pool. It’s straightforward: if you want to long SOL, you deposit SOL as collateral; if you want to short, you use a stablecoin.
Let’s say a trader wants a 2x long SOL position worth $100. They put up $50 in SOL, borrowing the other $50 from the pool.
- If SOL goes up 20%, the position earns $20, and the trader exits with $70 worth of SOL.
- If SOL drops 20%, the position loses $20, leaving the trader with $30 worth of SOL.
Simple, clean, and capital-efficient—giving traders more exposure with less upfront capital.
Leverage, Borrow Fees, and Liquidations
Leverage goes up to 500x, but pushing limits comes with risks. Borrowing assets from the pool means traders pay a dynamic hourly borrow rate, calculated as:
hourly borrow fee = (tokens borrowed / tokens in the pool) * (hourly borrow rate) * (position size)
For example, if SOL utilization is 50% and the hourly borrow rate is 0.01%, a $1000 SOL long would accrue $0.05 per hour in borrow fees.
Liquidation happens when a trader’s collateral—after fees and unrealized losses—falls below 0.2% of their position size. Unlike legacy platforms, Jupiter Perps ensures liquidations happen efficiently, without unnecessary slippage.
Jure Granić-Skender on the Exciting Potential of JLP
Jure Granić-Skender, known as Pileks, is a talented blockchain developer currently building Verve – an innovative smart wallet architecture designed for low-cost embedded wallet creation and seamless user onboarding. Jure and his team have been working together for over 6 years, and before Verve, they won a $20,000 prize at Bonkathon with the app “Bonk Art.”
Jure shares his perspective on the JLP token:
“Why is JLP so exciting? From a technical perspective, JLP is a token that represents your share in the Jupiter Perps liquidity pool. For example, if there’s a total of 100 tokens, 1 token would be 1% of the pool.
The way Jupiter’s Perps work is that they borrow assets from the pool, and later return the borrowed assets with interest back into the pool. This means that the pool continuously grows, and with that, the value of your shares.
This mechanism makes JLP an amazing asset that accrues value during both bull and bear runs. On the way down, the value of JLP falls slower, and on the way up, it rises faster, steadily outperforming all its underlying assets.
And, JLP performs exceptionally well when speculation is high – the more volume is traded, the better its APY.
This is why I find JLP to be amazingly exciting for more careful investors, who are interested in long-term growth over short-term gains.”
This mechanism makes JLP not only a great passive income asset but also a compelling choice for long-term growth, particularly in the dynamic DeFi market.
Signal Oracle: No More Execution Delays
Oracles are often the weakest link in perpetual trading. Jupiter Perps changes that with Signal Oracle, co-developed with a major ecosystem player (to be announced at Breakpoint). This new oracle eliminates execution delays by updating price feeds within the same transaction as the trade.
No more “waiting for the oracle to update”—trades execute instantly, and price accuracy is guaranteed. Signal Oracle also powers the trading charts, meaning what you see is exactly what you trade.
Why Perps Matter and How Jupiter is Leading the Charge
Perpetual futures have become a dominant force in both CeFi and DeFi trading, often surpassing spot volumes. Native DeFi users—especially degens—thrive on leverage, which is why the perps market is exploding. This shift from spot to derivatives dominance is evident in on-chain data, with derivative volumes outpacing spot by 1.3x across all chains in 2024.
Jupiter Perps, despite still being in beta, is already seeing massive adoption. With only three trading pairs (SOL, wBTC, ETH), it has facilitated over $32B in volume in under two months, generating $50M in fees—of which Jupiter keeps 30% as revenue. This number is only set to rise as new pairs and advanced features roll out.
By integrating Jupiter Perps directly into the Jupiter Swap ecosystem, traders get a seamless experience. Any Solana-based token can be used as collateral thanks to Jupiter’s smart routing, reducing friction and increasing trading efficiency. This kind of marginal improvement is what drives higher volumes and deeper engagement.
A Fee-Generating Powerhouse
Higher volumes and the ability to liquidate overleveraged positions result in higher fee-generating potential for derivatives protocols. Jupiter Perps isn’t just an extension of Jupiter Swap—it’s rapidly becoming the primary revenue driver for the entire Jupiter ecosystem, accounting for ~80% of all fees generated. To put things into perspective, Jupiter’s total fees last week were $9.8M, an annualized $510M, with $397.6M attributed to perps alone. With Jupiter keeping 30% of perp fees, this translates to $122M in projected yearly revenue.
On top of that, JLP holders benefit from an APR exceeding 120%, making it one of the best risk-adjusted DeFi yields available today. The reinvestment of fees into JLP boosts its price and compounds returns, making it an attractive option for liquidity providers.
Future-Proofing Solana’s Trading Landscape
Jupiter Perps isn’t just about competing with existing platforms, it’s about future-proofing on-chain trading. As Solana continues to dominate the on-chain derivatives market, Jupiter remains at the center of that growth, capturing 66% of Solana’s perp volume and expanding its market share across all chains. With a first-mover advantage in Solana perps, a high-fee, high-yield liquidity model, and a trading experience that rivals centralized exchanges, Jupiter Perps isn’t just another DeFi product—it’s the foundation of Solana’s trading future.
