Unveiling Jito's new valuation logic: How JTX is reshaping the business, with a bullish base case of 57% and a probability-weighted target soaring 267%.
Written by: ake Koch-Gallup & Sam Schubert
Translated by: AididiaoJP, Foresight News
After JTX launched on July 14, we focused on how to price JTO. This product is reshaping Jito's business model: it is no longer just a price taker for Solana block space, but has started to price user traffic. Our base case implies a 57% upside potential, while the probability-weighted target points to a potential increase of 267%. Meanwhile, the entire crypto market is undergoing a broad correction, with only the crypto miner sector standing out in the green thanks to a wave of AI data center deals.
Looking at it over a longer time frame, one trend remains prominent: over the past week, the crypto miner sector surged by 27.0%, significantly outperforming all other crypto sectors. Following closely are DEX (+4.6%), Bittensor ecosystem (+4.3%), and Ethereum ecosystem (+3.9%). The broader stock market was nearly flat during the same period.
This round of increases is mainly driven by a series of AI infrastructure announcements, as investors are changing their valuation logic for Bitcoin mining companies. On July 20, Hut 8 announced a new 15-year, $9.8 billion lease for its Beacon Point facility, covering 352 megawatts of power. The agreement doubles the contracted capacity to 704 megawatts, raising the total base contract value to $19.6 billion. On the same day, IREN signed a new $2.8 billion AI cloud contract, increasing its run rate target from $3.7 billion to over $4.0 billion by the end of the year, with approximately 85% of the capacity already contracted to customers such as Microsoft, Nvidia, and Perplexity.
The market reacted quickly. Over the past week, Greenidge rose 59.6%, followed closely by Cipher (+51.4%), Hut 8 (+31.4%), Riot (+30.4%), and CleanSpark (+22.9%). The common factor is that investors are increasingly viewing these companies as owners of scarce power and data center infrastructure, rather than just Bitcoin miners. As long as the demand for AI computing power continues to exceed supply, this narrative will likely remain a major catalyst for the sector, even if Bitcoin itself remains range-bound.
Jito's JTX Valuation
Today, we delve a bit deeper into how to value JTO. The progress of JTX is redefining what this company is all about. The market still prices it as Solana's backend infrastructure—a price taker reliant on block space activity—while JTX (launched on July 14) has effectively transformed it into a price setter for user traffic. Our buy logic focuses on whether Jito can truly capture that traffic, rather than just a rebound of the traditional business.
Although the execution data for JTX is still early, it has already provided positive signals. Since its launch, over 77,000 transactions have occurred, with the median transaction price deviating from the oracle mid-price by only 5.5 basis points, and 77.6% of transactions falling within 25 basis points. A further 29.1% even surpassed the oracle quotes. The quality of transactions is highly correlated with liquidity: the median deviation for SOL is 3.9 basis points, while that for JitoSOL is just 0.5 basis points, and long-tail illiquid assets show wider deviations. The advantages brought by BAM are not yet significant: BAM dominates blocks with a 4.6 basis point deviation, while other blocks show 4.8 basis points.
This trading structure is formed because Jito intentionally sacrificed short-term revenue to optimize Solana's long-term market structure—it closed off predatory MEV traffic and prioritized BAM, directly reducing the previously high-profit Jito tip revenue.
The model remains conservative regarding traditional business: it does not assume tip revenue returns to peak levels, does not assume JitoSOL LST recovers, and does not assume BAM fully monetizes. The base case instead assumes JTX captures 15% of Solana DEX transaction volume by Q2 2027, leading to a quarterly net income of $5.8 million and total revenues of $8.2 million, or around $32.7 million annualized, with JTX accounting for about 72%. This implies an adjusted price-to-sales ratio of less than 15 times based on Q2 2027 annualized revenue.
Historical experience shows this is inexpensive: even with declining revenue, the average price-to-sales ratio of backend infrastructure businesses since early 2025 remains around 38 times. Valuing the base case annual revenue conservatively at 30 times corresponds to a JTO price of $1.18, implying about a 57% upside potential. For a growing business with a superior front-end economic model, a 30 times valuation is not excessive, especially compared to a shrinking business enjoying a 38 times valuation.
Scenario ranges are widely varied. The optimistic scenario (probability 40%) assumes JTX shares reach 25% and assigns a 45 times valuation, corresponding to a price of $5.31, a 600% increase; the pessimistic scenario (probability 10%) assumes a share stagnation at 5% and a reduction of price-to-sales ratio to a commoditized 15 times, corresponding to $0.36, a 52% decline. The weighted target price across the three scenarios is $2.75, suggesting an implied upside potential of about 267% relative to the current price of approximately $0.75. The valuation is highly sensitive to Solana DEX transaction volume, and our weighting leans towards the optimistic, as we believe tokenized stocks and real-world assets will scale on-chain, thereby boosting transaction volume and JTX's share.
JTX also clarifies the value capture of JTO: it is expected that 80% of its revenue will be used for buybacks. In the base case, approximately $8.6 million will be repurchased over the next 12 months, reducing the adjusted supply by about 1.5% (about 5.7% in the optimistic scenario). The current scale of the flywheel is still small but will be directly amplified with the success of JTX.
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