Jito’s Bold Move: Revolutionizing Solana with a Game-Changing Block-Building Mechanism
Solana's infrastructure just got a turbocharge—Jito's proposing a radical overhaul to how blocks get built. The upgrade promises faster transactions, leaner operations, and a potential edge over Ethereum's lumbering Layer 1. Here's the breakdown.
Why This Matters
Block-building bottlenecks have been Solana's Achilles' heel—network congestion turns into a $10M+ MEV buffet for arbitrage bots. Jito's fix? A decentralized auction system that lets validators compete for block space. No more centralized sequencer black boxes.
The Finance Angle
Of course, VC-backed infrastructure firms will take their cut—call it the 'validators' vigorish.' But if it actually works, SOL might finally shake its 'ETH beta-test network' reputation. Just don't ask about last quarter's 47% validator churn rate.
Jito changes Solana block-building
Solana has a complex legacy system of block building, with no dedicated MEV builders. Jito is one of the main block optimizers, working through auctions for favorable transaction placements.
There are also services that sponsor the SOL gas fee and offer traders a SAFE endpoint to avoid sandwich attacks. Traders and users also unleash MEV bots, which compete for front-running transactions.
Jito will upgrade its auction system and replace it with the Block Assembly Marketplace (BAM). The new approach to transaction processing will include a new LAYER of hardware nodes, additional validators, and plugins to connect developers. BAM is built for the needs of developers aiming to launch apps with specific transaction-ordering rules.
One of the key features will be specialized encryption hardware, which will keep transactions encrypted until execution, and will verify all transfers in a trustless way. The encrypted transactions will also lift the accusations that some pools and relayers, including Jito, are exposing the data to malicious actors and MEV bots.
BAM will allow developers to create products that can hide transactions, cancel them, or change them until the very last moment.
The new approach to block building can optimize Solana-based perpetual swaps similar to Hyperliquid. Other use cases include dark pools for trading, or on-chain games with limited frontrunning.
Jito to start BAM as a centralized service
Jito Labs will start the BAM service with centralized control, creating the Ecosystem Advisory Committee. Initially, the service will recruit validators, as well as the Solana Foundation.
Jito Labs will also run the first BAM nodes until gaining assurance that the network is stabilized. Later, third-party shortlisted validators will join. Those include Triton One, SOL Strategies, Figment, Helius, and others aligned with the Solana idea.
The BAM program will also recruit an initial cohort of applications to test the plugins and the new approach to offering encrypted transactions, verifiable by dedicated Nodes and Validators.
Even before the BAM proposal, Solana reported fewer MEV attacks. Despite this, Jito is still the main transaction relayer, with $1.34M in daily fees generated. Launching BAM may spread the revenues from block-building between nodes, validators, and even app developers.
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