- 0xResearch
- Posts
- Jito's JTX rerating
Happy Friday, folks! Today, we dig into how we value JTO following JTX’s July 14 launch. The product is reshaping Jito’s business, turning it from a price taker on Solana blockspace into a price setter on user flow, with our base case implying 57% upside and our blended target implying 267%. Meanwhile, crypto sold off across the board, with Crypto Miners the lone green sector on a wave of AI data center deals.
Yesterday saw broad weakness across crypto, with Crypto Miners standing out as the only sector to finish in positive territory, gaining 1.4%. Modular (-3.7%) led the declines, followed by DePIN (-3.1%), the 2025 Crypto Equity Cohort (-3.0%), and AI (-3.0%). BTC held up relatively well, falling -1.5%, broadly in line with the S&P 500 (-1.1%) and Nasdaq 100 (-1.7%). Risk sentiment was weak across all markets. The Nasdaq Composite fell more than -2%, oil prices moved higher, and the Magnificent Seven sold off ahead of next week's Fed meeting.
Looking beyond the daily move, one trend continues to stand out. Crypto Miners have rallied 27.0% over the past week, outperforming every other crypto sector by a wide margin. The next strongest performers were DEXs (+4.6%), the Bittensor Ecosystem (+4.3%), and the Ethereum Ecosystem (+3.9%). In comparison, the broader equity market was little changed over the same period.
The rally has been driven by a string of AI infrastructure announcements that are reshaping how investors value Bitcoin miners. On July 20, Hut 8 announced a second 15-year, $9.8B lease for 352 MW at its Beacon Point campus. The agreement doubled contracted capacity to 704 MW and increased total base contract value to $19.6B. On the same day, IREN secured another $2.8B of AI cloud contracts. This lifted its year-end run-rate target from $3.7B to more than $4B, with roughly 85% of capacity now contracted to customers including Microsoft, Nvidia, and Perplexity.
The market responded quickly. Greenidge has rallied 59.6% over the past week, followed by Cipher (+51.4%), Hut 8 (+31.4%), Riot (+30.4%), and CleanSpark (+22.9%). The common thread is that investors are increasingly valuing these companies as owners of scarce power and data center infrastructure rather than simply Bitcoin miners. As long as demand for AI compute continues to outpace supply, that narrative is likely to remain the sector's primary catalyst, even if Bitcoin itself remains rangebound.
Jito’s JTX Valuation
Today we go a little deeper on how we value JTO, where the JTX development is reshaping what the business actually is. The market still prices it as backend Solana infrastructure, a price taker on blockspace activity, even as JTX (launched July 14) turns it into a price setter on user flow. Our buy thesis underwrites Jito's ability to own that flow, not a rebound in the legacy business.
JTX's execution data is early but supportive. Across more than 77K trades since launch, the median trade landed 5.5 bps from the oracle mid, 77.6% within 25 bps, and 29.1% beat the oracle outright. Quality tracks liquidity, with SOL recording a median of 3.9 bps and JitoSOL 0.5 bps, while thin long-tail names are wider. The BAM edge is not yet material: 4.6 bps in BAM-led blocks versus 4.8 bps elsewhere.
The trade setup exists because Jito deliberately traded near-term revenue for Solana's long-term market structure by shutting down extractive MEV flows and prioritizing BAM, which reduced the high-margin Jito-tip revenue that once flattered its numbers.
The model stays conservative on that legacy business, underwriting no return to peak tip revenue, no JitoSOL LST recovery, and no full BAM monetization. The base case instead models JTX reaching 15% of Solana DEX volume by Q2 2027, driving $5.8M of quarterly net revenue and $8.2M total, or $32.7M annualized, with JTX at roughly 72% of the mix. That implies a treasury-adjusted P/S of less than 15x on Q2 2027 annualized revenue.
History says that is cheap: the backend infrastructure business alone has averaged ~38x since the start of 2025, even as its revenue declined. Applying a conservative 30x to base-case annualized revenue implies $1.18 JTO, ~57% upside, and 30x for a growing business with superior front-end economics is reasonable against 38x for a shrinking one.
Our scenarios fan wide. The bull case (40%) takes JTX to 25% share at a 45x multiple for $5.31, +600%; the bear (10%) stalls at 5% share and de-rates to a commoditized 15x for $0.36, -52%. Blending the three scenarios gives a probability-weighted target of $2.75, ~267% upside from ~$0.75. The valuation is highly sensitive to Solana DEX volume, and the weighting leans to the upside on conviction that tokenized equities and real-world assets scale onchain, lifting both volume and JTX's share.
JTX also gives JTO clearer value accrual, with 80% of its revenue expected to flow to buybacks: ~$8.6M over the next 12 months in the base case, retiring ~1.5% of treasury-adjusted supply (~5.7% in the bull). The flywheel is small today but scales directly with JTX’s success.
— Sam
Blockworks Advisory outlines that Bonk's structural value accrual mechanisms remained intact despite a sharp slowdown in Solana memecoin activity, with the Q2 revenue decline reflecting a broader market contraction rather than protocol specific weakness. The report highlights BONKbot's resilience, continued token burns, and Bonk Inc.'s steady treasury as evidence that the ecosystem's demand flywheel continues to function, even at lower activity levels. Looking ahead, it identifies BONKfun regaining launchpad market share, BNKK increasing its BONK treasury, and BONKtrade expanding into new markets as the key catalysts for reigniting structural demand.
Blockworks Research proposes that Bitcoin may be at or near a high-time-frame cycle bottom, with multiple historical indicators simultaneously signaling an attractive long-term accumulation zone. The report highlights record oversold readings versus the Nasdaq and gold, BTC's proximity to its realized price, and the typical duration of past bear markets as evidence that downside may be limited over a one to three year horizon. While it cautions that these signals are based on a small number of historical cycles and offer little guidance on short-term price action, it concludes that the period through the end of 2026 could represent a compelling window to rebuild long-term exposure.
Franklin Templeton argues that agentic AI could become the catalyst that drives mainstream blockchain adoption, as autonomous AI agents will require low cost, programmable, and verifiable payment rails that traditional financial infrastructure cannot efficiently provide. The paper contends that blockchains are uniquely suited to enable machine-to-machine payments through smart contracts, decentralized identity, auditability, and high throughput settlement, creating growing demand for the underlying network tokens. As agentic commerce expands, the authors believe investors may need to own cryptocurrencies and application tokens, rather than just AI company equities, to capture the value created by decentralized AI ecosystems.
