• Jupiter Exchange is set to use 50% of transaction fees generated to buy back JUP from the market.
• JUP could fall lower on the chart, as its recent activities aren’t bullish.

In the past 24 hours, Jupiter [JUP] has seen a minor price increase, gaining 1.77% in an attempt to clear its weekly loss of 4.21%.

While positive developments in its ecosystem present a bullish opportunity, traders’ bearish activities could potentially override this, causing JUP to extend further downward.

Will JUP’s fundamentals hold up?

Jupiter Exchange, the platform behind the JUP token, recently announced plans to use 50% of transaction fees generated to buy back JUP from the market.

Such a move indicates Jupiter’s intention to reduce the circulating supply of JUP by buying and holding the token. This strategy aims to induce a supply squeeze, potentially causing the altcoin to rally.

By calculation, $600 million would be spent on this action this year, representing 25% of JUP’s $2.4 billion market capitalization.

While this fundamental factor appears bullish, market participants aren’t responding positively, and there has been a drop in active usage, adding downside pressure to JUP.

Downside pressure persists

Data from Artemis shows a significant decline in market activity and engagement across JUP’s ecosystem, adding to the downside pressure on the asset.

On the 23rd of January, daily transactions involving JUP totaled 83,500, signaling positive growth. However, this number has since dropped significantly,

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Author: Olayiwola Dolapo