Andreessen Horowitz’s crypto arm, a16z Crypto, has invested $50 million in Jito, a Solana-based liquid staking and infrastructure protocol, in a deal announced today Oct 16.
The investment, which was executed through a private token sale, will provide a16z with Jito’s native JTO tokens. The funding will be used to Solana’s staking network by improving liquidity, validator performance, and efficiency.
According to Brian Smith, executive director of the Jito Foundation, the deal is the largest single investment Jito has received. He said it establishes a long-term alignment between the two entities.
“If you’re accepting long-term alignment where you can’t sell for a while, then there’s traditionally some modest discount associated with that,” Smith said, without sharing exact terms. The investment values Jito at around $800 million, with a market capitalization near $442 million based on circulating tokens.
Jito was designed with the aim of improving the performance of validators in Solana. It enables users to reap staking rewards while having their tokens remain accessible. In addition, it implements maximum extractable value (MEV) technology, which enables the enhancement of rewards and enhances security in the network. Currently, the platform secures approximately 14 million SOL in stake and operates over $2.8 billion in total value locked.
Meanwhile, Jito’s staked SOL decreased by roughly 4 million tokens since May, but the protocol still generates more than $400 million yearly from such activities as decentralized block-construction.
a16z Crypto’s Ali Yahya, a general partner at the firm, said, “We’re excited to back Jito and its stellar team’s efforts to accelerate the adoption of decentralized finance.” Meanwhile, the investment follows other crypto deals in the year made by a16z, such as $55 million in LayerZero and $70 million in EigenLayer, which indicates that they are still interested
Andreessen Horowitz has been involved in Solana’s development before, taking part in the network’s $314 million private token sale in 2021.
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