Jito BAM: Near‑Term Headwinds for SOL & JTO

BAM will improve Solana's microstructure and design space, empowering developers to build applications that require more granular control over sequencing, such as prioritizing cancels on perps DEXs, and mitigating negative MEV externalities, such as frontrunning.

By enabling apps to internalize transaction sequencing, Jito is acting as a good steward for the network, despite forgoing incremental revenue (i.e., Jito tips) if the existing Block Engine is deprecated following the adoption of BAM. BAM sorts transactions based on priority fee with a 20ms auction tick (assuming no custom sequencing via Plugins), executing all conflicting transactions in a FIFO manner. The end goal is to offset lower fees per transaction with more volume. 

Note that this isn't the first time Jito has voluntarily shut down a revenue stream for the benefit of the ecosystem. In March 2024, Jito Labs discontinued its MempoolStream service, a 200ms window during which searchers could see all incoming transactions. MempoolStream effectively acted as a proxy mempool for Solana, leading to UX degradation and an increase in sandwich attacks once memecoin activity on the network surged. Despite shutting down the mempool, Jito tips continued to increase over the following months, reaching an all-time high of almost $300M in January 2025, about 10x higher than when the mempool was deprecated.

We could see a similar dynamic play out with BAM over the long term, where the increase in aggregate demand from CLOBs, perps exchanges, dark pools, and other applications uniquely enabled by BAM offsets the unit decrease in fees per transaction. 

This report is organized in two parts. The first part discusses BAM’s second-order effects in Solana’s DeFi ecosystem. The second part provides a backward and forward-looking valuation for both SOL and JTO in light of the proposed changes. 

BAM Ecosystem Implications