From $3.5M to $674M in yearly REV: Inside Jito and our vision for 2025

Background

As Jito Labs accelerates into 2025, one common piece of feedback I’ve received from my team and others is to spend more time articulating my thoughts in writing. In this article, I’ll dive into my thoughts on 2024 and where Jito Labs and the ecosystem should focus moving into 2025, mostly focusing around MEV. For supplementary reading on Solana MEV, I recommend Helius’ recent blog post on the topic.

For those not familiar with myself or Jito Labs, let me give a quick intro. I’m Lucas Bruder, the co-founder and CEO of Jito Labs. Jito Labs is a team of 14 (16 next week) and the leading MEV infrastructure company on Solana. We are the architects behind the Jito Block Engine and Jito-Solana validator client. Today, the Jito-Solana validator client, a fork of Agave, runs on 94% of stake and has generated an additional $750M in revenue for the network. Jito tips accounted for around 50% of REV on the Solana network in 2024.

In 2024, Solana’s explosive growth transformed it into the leading blockchain by several key metrics. Daily volume peaked at $10B, while the network generated $27.6M in daily fees during peak periods. This meteoric rise brought growing pains: users struggled with transaction inclusion as MEV bots competed for blockspace, memecoin trading reached fever pitch with platforms like pump.fun driving unprecedented network activity, and validators worked to adapt to the new demands on infrastructure. Where Ethereum traditionally led the attention game, the eyes were now on Solana. MEV on Solana really accelerated and surprised us in the best (and worst) way possible. 2024 brought both engineering and social challenges as the ecosystem grappled with growing pains.

Looking Back on 2024

Growth of Jito-Solana & Jito Tips

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When we entered 2024, the Jito-Solana validator client was already a significant presence, running on 48% of network stake. By year’s end, that number had nearly doubled to 94% of total network stake. This dramatic increase wasn’t just about numbers; it represented a fundamental shift in how the Solana ecosystem viewed MEV infrastructure.

This growth was driven by a diverse coalition of validators. Large institutions integrated Jito-Solana into their infrastructure, bringing their significant technical expertise and rigorous requirements to our ecosystem. Alongside these institutional players, independent validators adopted the client, creating a healthy mix of operators that strengthened network decentralization.

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The economic impact of this adoption became clear through Jito-Solana tip metrics. In 2023, validators running Jito-Solana generated $3.52M in tips. In 2024, this figure had grown to $674M, representing a large increase in additional revenue for validators and stakers. $550M of these tips flowed to Solana stakers. What makes these tips particularly significant is that they represent entirely new revenue that wouldn’t have otherwise reached the staking ecosystem. While priority fees paid by users in regular transactions go to the network’s fee burn mechanism and validators, Jito tips flow transparently and directly to validators and their stakers. This means that without Jito-Solana, this substantial revenue would have either remained with MEV extractors or never been captured at all, rather than being distributed to the stakeholders securing the network.

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This growth in tips proved particularly significant for smaller validators, helping to maintain a diverse validator set by improving the economics of running block producers. This technical infrastructure ultimately translates into real human impact, as I was reminded at a Solana meetup. There, I met a validator whose story perfectly captured why we built Jito in the first place. This validator was deeply involved in the Solana community but struggled to attract stake to their operation despite their dedication and technical expertise. They were just days away from shutting down their validator when disaster struck - their node experienced a significant delinquency lasting several hours one morning. They feared this would be the final blow, causing them to lose what little stake they had managed to attract.

But sometimes fortune favors the persistent. Hours after their validator came back online, they received several Jito tips worth approximately $150,000, which has allowed them to continue covering their operational costs for several years. This unexpected windfall gave them the runway they needed to build a sustainable operation. Today, they’re still running their validator, contributing to network decentralization and the broader Solana community.

This story exemplifies what we’re building at Jito Labs - infrastructure that not only improves network efficiency but helps sustain a diverse, decentralized validator set where dedicated operators can thrive regardless of their size. It’s a reminder that behind every technical metric and performance improvement, there are real people building and maintaining the infrastructure that makes Solana possible.

Changing Trading Scene

When we first developed Jito-Solana, our vision was focused primarily on traditional MEV capture - arbitrage, liquidations, and other value capture that had become familiar in the DeFi landscape. However, 2024 brought unexpected shifts in usage patterns that transformed how Jito infrastructure was utilized across the network.

The rise of memecoins on Solana marked a significant departure from our initial expectations. While traditional MEV searchers remained active, Telegram bot operators emerged as the dominant force in transaction fees and tips. These bots, designed to facilitate rapid memecoin trading and sniping, began leveraging Jito-Solana’s efficient transaction inclusion mechanisms in ways we hadn’t anticipated when we originally built the system. The infrastructure that was built for sophisticated MEV capture became a crucial tool for retail traders attempting to capture early positions in trending tokens.

The surge in memecoin trading, particularly on platforms like pump.fun, drove network activity to unprecedented levels. Traditional arbitrage opportunities, while still significant, were overshadowed by the sheer volume of memecoin-related transactions. This transformation highlighted both the adaptability of our infrastructure and the need to evolve our approach to transaction processing and user protection.

Throughout 2024, we also witnessed a significant influx of sophisticated market participants leveraging our infrastructure. Traditional trading firms and HFT outfits, drawn by Solana’s high throughput and low latency, began integrating directly with our systems for market making and cross-exchange arbitrage. These firms brought institutional-grade trading strategies to on-chain venues, particularly focusing on CEX-DEX arbitrage opportunities. Their presence not only added substantial liquidity to Solana’s DeFi ecosystem but also pushed our infrastructure to new levels of performance and reliability. The demanding requirements of these professional trading operations helped us identify and optimize critical paths in our architecture that benefited all users.

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As the ecosystem evolved, our infrastructure found new utility beyond its original MEV-focused design. In December 2023, ~16.1M bundles were processed on-chain. By December 2024, our system processed a staggering 590M, a 36x increase. This explosive growth pushed our systems to their absolute limits, revealing bottlenecks we never anticipated when designing the original architecture.

Our engineering team found themselves in an intense cycle of firefighting and optimization throughout 2024. The sheer volume of bundle submissions exposed critical bottlenecks in our bundle processing pipeline. What started as occasional latency spikes during peak periods evolved into sustained system stress as network activity continued to climb. We discovered that our original bundle merging and simulation algorithm, while efficient for moderate volumes, became a significant bottleneck when processing hundreds of millions of bundles. The team had to completely redesign this component, implementing a more sophisticated parallel processing approach that could handle the increased load.

Throughout this period, our engineering team operated in a constant state of performance optimization, often making critical infrastructure improvements while the system was handling peak loads. We implemented sophisticated monitoring and alerting systems, allowing us to identify and address potential bottlenecks before they impacted users. The experience taught us valuable lessons about building truly scalable infrastructure and helped inform our architectural decisions moving into 2025.

The Mempool

When we first designed a public mempool, we envisioned it primarily as a tool for efficient arbitrage execution. This is evident by all of the original marketing and exemplar code snippets which leveraged the mempool and an open source arbitrage bot. The concept was straightforward: by allowing MEV searchers to monitor and backrun transactions, we could facilitate healthy value capture that would benefit both traders and the broader network by returning value to validators and making the network more efficient by removing spam. Throughout 2023, this model functioned largely as intended, supporting legitimate arbitrage activities while maintaining network efficiency.

However, by the end of 2023, the explosive growth of memecoin trading and Telegram bot activity on Solana began raising serious concerns about how the mempool was being utilized. With each new memecoin launch attracting waves of retail traders using Telegram bots, sandwich attacks became increasingly prevalent and sophisticated. Our initial response mirrored what we’re seeing proposed today with systems like Paladin – we implemented policies designed to detect and prevent these sandwich attacks. This included looking at account and signer access patterns across multiple transactions within the same bundle. What we discovered next proved enlightening, though not in the way we had hoped. MEV searchers quickly demonstrated remarkable adaptability, developing increasingly sophisticated methods to circumvent the protections. They began splitting their sandwiches across multiple bundles and implementing probabilistic spamming approaches that made detection and mitigation exponentially more difficult. Adding to this complexity, we observed some validators beginning to capture MEV internally by running modified versions of the validator client, fragmenting the MEV landscape further and making systematic protection even more challenging. The nature of memecoin trading patterns combined with the high volume of Telegram bot activity created a perfect environment for these evolving sandwich strategies. After investing significant engineering resources into what became an escalating cat-and-mouse game, we realized we were addressing symptoms rather than the root cause. After a few weeks of this policy, we reverted the policy and went back to the drawing board.

The decision to shut down the public mempool wasn’t taken lightly. It followed weeks of intense internal debate and extensive consultation with ecosystem stakeholders. I can say without hesitation that this was the most stressful period of my professional life – we were acutely aware that this decision would send ripples throughout the entire ecosystem. Our primary concern centered on the potential emergence of private mempools, which could fragment the ecosystem and potentially worsen the very problems we were trying to solve.

Our analysis of broader ecosystem trends, particularly around L2s and the increasing competition for blockspace, ultimately convinced us that shutting down the mempool was the right path. We recognized that as the ecosystem matures and more users migrate to L2s, there would be natural pressure toward MEV-resistant infrastructure. L2s, competing for users and focused on optimization, have strong incentives to prevent sandwich attacks and other forms of harmful MEV. This realization helped us frame the mempool closure not as an endpoint, but as a strategic pause that would give the ecosystem time to develop more robust, systematic solutions.

What surprised and encouraged us during this process was the broad support we received from validators, users, and applications on Solana. In conversations across the ecosystem, most validators understood and agreed with our assessment, recognizing that short-term revenue losses were worth bearing for the network’s long-term health. This alignment between infrastructure providers and validators highlighted a shared commitment to sustainable growth over quick profits.

While this decision has generated significant discussion on Twitter, we believe much of the criticism misses the broader context and strategic considerations that informed our choice. At Jito Labs, we maintain a very long-term view of Solana’s development – our decisions aren’t driven by monthly or even yearly metrics, but by our vision of what the ecosystem needs to thrive over the next decade. Looking back, we remain confident that closing the mempool was necessary to create space for more sustainable solutions to emerge. Sometimes protecting an ecosystem requires making difficult decisions that may not be immediately popular but serve the long-term interests of all participants.

Moving Into 2025

As we move into 2025, I thought it’d be useful to make some observations and add thoughts around trends I’m noticing in Solana and transaction landing, as well as where Jito Labs is headed.

Community Desires

Moving into 2025, the Solana community has crystallized around several fundamental priorities for MEV and transaction landing infrastructure, with abundance, reliability, transparency and open-source development leading the charge. Stakeholders are demanding greater visibility not just into technical operations, but into the entire MEV ecosystem - from transaction processing to value creation and distribution. This extends to understanding incentive structures and business relationships that impact network participants.

While proprietary systems like Jito Labs’ Block Engine played a crucial role in Solana’s early MEV infrastructure, we recognize that sustainable growth requires open, collaborative development. As we move into 2025, open source will be a big theme at Jito Labs. We’re actively transitioning to open sourcing more infrastructure to enable greater community participation and innovation for Solana MEV. This evolution reflects our understanding that the future of MEV on Solana must be built on transparent, auditable foundations that the entire ecosystem can help shape and improve.

The ecosystem currently suffers from unnecessary fragmentation and opaqueness, with competing services and standards creating a complex web of infrastructure that’s becoming increasingly difficult to navigate. Rather than addressing the root causes of harmful MEV extraction, this fragmentation has led to a zero-sum environment. We envision a future built on unified, systematic approaches that protect users while preserving Solana’s core values of performance, openness and accessibility.

This vision reflects an ecosystem maturing beyond quick fixes toward lasting, robust infrastructure - one built on foundations that everyone can audit, understand, and enhance, fostering growth through collaboration rather than competition.

Sandwich Mitigation

While sandwich attacks have dominated recent discussions around MEV on Solana, we see multiple parallel developments that will collectively transform how value capture and transaction ordering work on the network. The ecosystem is making significant strides across several key areas that, when combined, will create a more robust and equitable trading environment.

Decentralized orderflow represents one promising direction, offering traders ways to discover and access liquidity without exposing their transactions to sandwich risk. Meanwhile, innovative AMM designs are emerging that make sandwiching fundamentally less profitable or viable. The growing adoption of RFQ systems by major protocols provides yet another avenue for users to access competitive pricing while avoiding common MEV vectors. These developments, coupled with ongoing improvements to Solana’s network infrastructure, point toward a future where sandwiching becomes progressively less relevant.

Rather than focusing on short-term patches, we believe the combination of these approaches will create an environment where traders can choose the execution method that best suits their needs, whether that’s through sandwich-resistant AMMs, RFQ systems, or traditional orderbook markets. Our team is actively contributing to and supporting these developments, recognizing that a multi-faceted approach leveraging Solana’s unique capabilities offers the most promising path forward.

We’re confident that as these solutions mature and combine with our own innovations in MEV infrastructure, the ecosystem will emerge stronger and more resilient. While sandwiching represents a challenge today, we believe it will ultimately be remembered as a catalyst that drove the development of more sophisticated and equitable trading infrastructure.

Orderflow

The dynamics of transaction orderflow emerged as one of the most significant and hidden challenges in Solana’s MEV landscape during 2024. As the ecosystem has matured, we’ve witnessed how transaction ordering naturally tends toward consolidation, even when systems are initially designed with decentralization in mind. Our own experience at Jito Labs has given us unique insight into this evolution - what began as an effort to improve transaction inclusion and validator rewards has demonstrated how quickly network effects can compound in MEV markets.

The proliferation of private, opaque swQOS deals particularly exemplifies the challenges of maintaining transparency in a maturing ecosystem. We’re seeing the emergence of complex arrangements where certain transaction landing services capture significant transaction flow, custodying and selectively distributing rewards through private channels, growing their networks of aligned participants. These arrangements often leverage delegated stake without transparency, meaning that those providing stake often lack visibility into how their delegation is being used or whether they’re receiving fair value for their participation. When value flows through hidden channels and reward distribution happens through private arrangements, it becomes increasingly difficult for stakeholders to make informed decisions about their participation in the network.

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The Ethereum ecosystem provides another clear example of these centralizing forces. With PBS (Proposer-Builder Separation), we’ve seen block building consolidate to where just two builders construct approximately 96% of all blocks. This concentration didn’t happen by accident - it emerged through a series of private orderflow arrangements where major builders secured exclusive relationships with applications like telegram bots. These builders leveraged their initial advantages to offer preferential treatment and specialized services, attracting more valuable orderflow which in turn allowed them to build more profitable blocks. As they captured more of the profitable orderflow, they could offer better terms to validators and applications, creating a self-reinforcing cycle of centralization. The natural network effects of orderflow and the opacity of these private arrangements led to a system where just two entities now dominate block production. Once such consolidation occurs, it becomes extremely difficult to reverse course - new builders struggle to compete without access to the same valuable orderflow, and the dominant players can maintain their position through continued private arrangements with major trading firms.

At Jito Labs, deep involvement in Solana’s transaction infrastructure has given us unique insight into how these market dynamics evolve, strengthening our conviction that the ecosystem needs systematic changes as it matures. The long-term health of the Solana network depends on developing transparent mechanisms for transaction ordering that prevent the accumulation of structural advantages through hidden arrangements. This is about evolving toward infrastructure that can scale with the network while preserving its core values of openness and accessibility. By open-sourcing more of our infrastructure and pushing for verifiable systems, we’re working to ensure that future innovations benefit the entire ecosystem rather than any single party.

The Future of MEV on Solana

The past year has been particularly instructive in understanding how MEV infrastructure behaves at scale. We’ve witnessed firsthand how transaction flow naturally tends toward centralization, how MEV capture strategies evolve in response to new infrastructure, and how different stakeholders adapt to changing market conditions. These lessons, combined with groundbreaking research from teams like Flashbots and our own operational experience, have given us a deeper understanding of MEV dynamics than we could have gained through theoretical analysis alone.

In the beginning of December, we had an offsite and I shared the following points with the team as goals moving into 2025:

• We build products that make Solana faster, more efficient, and more profitable than it could ever be without us.
• We should fundamentally improve the network, not just build on top of it. We are unique in our ability to enhance Solana’s capabilities.
• And importantly, we should make concrete improvements to Solana, not just theoretical ones.

As we enter 2025, we plan to accelerate on all of the points above. Jito Labs finds itself in a unique position to shape the future of MEV on Solana. The journey of Jito-Solana from 48% to 93% network stake represents more than just growth—it represents our first large-scale iteration in MEV infrastructure. Through building the Jito-Solana validator client and the Jito Block Engine, we’ve gained invaluable practical insights into how MEV systems evolve under real-world conditions. However, true innovation requires not just learning from experience, but evolving beyond it. Rather than iterating on familiar patterns, we’re taking these hard-won insights and using them to fundamentally reimagine how MEV infrastructure can serve the ecosystem. Our next phase of development will incorporate these lessons while charting new territory, focusing on solutions that address the root causes of centralization and negative MEV we’ve observed rather than building incremental improvements to existing systems.

Looking ahead, we recognize that the ecosystem needs a fundamentally different approach to MEV—one that builds on the lessons from our first generation of infrastructure while avoiding its pitfalls. By studying Ethereum’s PBS implementation, where block building consolidated to just two dominant players, we’re designing our next generation of infrastructure to systematically prevent such concentration of power through orderflow capture. Our vision centers on three key pillars:

• First, we’re committed to expanding our open-source initiatives. Our experience operating closed systems has shown us that sustainable growth requires transparent, collaborative development. This shift will enable greater community participation and innovation in Solana’s MEV infrastructure.
• Second, we’re developing enhanced privacy primitives and new approaches to transaction ordering. Instead of iterating on existing patterns, we’re investigating novel architectures that could fundamentally reshape how transaction flow and value capture work on Solana.
• Third, we’re committed to fostering an environment where competition drives innovation rather than fragmentation. Instead of seeing the ecosystem split into competing services that divide existing value, we envision a future where teams compete openly to create new value and possibilities for the entire network. This shift in mindset - from fighting over market share to collaboratively expanding what’s possible - will be crucial for Solana’s long-term growth. By encouraging open innovation and experimentation, we can harness the ecosystem’s competitive drive to strengthen core infrastructure rather than create isolated fragments. This approach will help us avoid pitfalls we’ve observed in other networks while maximizing the collective benefits of technological advancement.

These initiatives reflect our understanding that no single team can solve these challenges alone. The next generation of MEV infrastructure must be built through deep collaboration across the ecosystem, combining academic insights with practical operational experience. We need researchers exploring novel approaches to transaction ordering, developers building more sophisticated trading infrastructure, and validators helping shape systems that serve their needs while maintaining network health. Our 2025 product roadmap directly addresses these needs through concrete deliverables that will advance MEV infrastructure for the entire ecosystem.

Our path forward emphasizes both technical and economic sustainability, moving away from short-term solutions like privileged transaction lanes. Through open-source development and collaboration, we aim to create an infrastructure that scales with network growth while maintaining decentralization. This includes developing enhanced privacy primitives, efficient transaction ordering, and standardized MEV capture approaches that prevent value concentration among few actors.

While memecoin trading played a crucial role in Jito’s 2024 growth story, our strategic vision encompasses a much broader landscape of MEV opportunities. We’re actively expanding trading infrastructure to support sophisticated trading strategies that extend far beyond memecoin markets, including enhanced support for CEX-DEX arbitrage and institutional market making. By building robust, low-latency infrastructure that caters to professional trading operations, we’re attracting traditional trading firms and market makers who bring not just liquidity, but also their expertise in building efficient markets. The infrastructure improvements we’re implementing are strategic investments in Solana’s future as a premier venue for professional trading. When traditional trading firms see Solana as a serious trading venue with institutional-grade infrastructure, they bring sophisticated strategies and substantial liquidity to the ecosystem, creating a virtuous cycle of market efficiency and participant growth.

Our expanded engineering capacity and deep understanding of Solana’s MEV dynamics, coupled with our demonstrated ability to learn from experience and make tough but necessary choices, enables us to move beyond incremental improvements toward fundamental advances in network architecture. The path forward isn’t about refining existing systems, but rather about applying the lessons from our first generation of MEV infrastructure to build more transparent, efficient, and equitable solutions for the entire ecosystem.

Solana is the Next Solana

Solana enters 2025 at the forefront of blockchain innovation, demonstrating unprecedented growth in network activity, developer adoption, and technical capabilities. The challenges we faced in 2024 were catalysts that pushed us to develop more sophisticated, scalable solutions. As we advance our understanding of MEV dynamics and transaction infrastructure, we see tremendous opportunity to build systems that harness Solana’s unique advantages while maintaining its core values. The path ahead requires careful consideration, rigorous technical development, and deep collaboration across the ecosystem. But with the foundation we’ve built, the lessons we’ve learned, and the trust of the community, we’re confident that Solana will continue to set new standards for blockchain performance, accessibility, and fairness. The future of finance is being built on Solana, and we’re excited to play our part in making that future more open, efficient, and equitable for everyone.

Disclaimer:

1. This article is reprinted from [Buffalu’s Substack]. All copyrights belong to the original author [Lucas Bruder]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
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