Solana’s Increasing Maturity Costs Stakers, But Not Validators

By Max Sherwood, RevTec founder. Many thanks to Othman Gbadamassi, Robert Tiong, Matthias Schmitz for their feedback on the first draft of this report. 

Key Insights

• In Q3, Solana’s fell behind Hyperliquid after 9 months as the highest-REV producing chain. Priority fees and Jito Tips generated generated $121M for validators and $58.6M for SOL stakers.
  
  

• Decreased memecoin trading volume but ongoing stablecoin and SOL trading volume mirrors the declining use of Jito tips, while priority fees remained persistent. 
  
  

• The reduction in Jito tips caused less REV to be earned by stakers, with their share falling below 50% for the first quarter ever.
  
  

• Jito’s Tip Router upgrade enables the sharing of priority fees, although has not yet seen any adoption from validators.
  
  

• SIMD-123 enables easy and transparent priority fee sharing, but the implementation timeline is unclear. 
  
  

• Upcoming changes such as increased CU limits, more efficient P-tokens, Alpenglow’s reduced voting costs, and Jito’s BAM all have the potential to shift REV and earning potential for Solana’s stakers.

Introduction

This quarter, Solana lost its status as the king of REV, and declining Jito Tips caused concern for SOL stakers. When will validators implement priority fee sharing? Will structural changes like increased compute unit (CU) limits be bullish or bearish for Solana’s REV? Read on, for these insights.

Definitions: First, let’s get on the same page:

• REV: “Real Economic Value”. The sum of all users’ payments for transaction inclusion. For simplicity, our definition of REV only includes in-protocol priority fees and out-of-protocol Jito tips. Also referred to as “network revenue”. 

• Priority Fees: Solana’s native fee mechanism, allowing users to pay extra for their transactions to be prioritized over others. Also referred to as “block rewards”, these fees are kept by the validator by default, but can be shared via custom logic or LSTs, Jito’s upgraded Tip Router, or the upcoming SIMD-123 implementation. 
  
  

• Jito Tips: A fee-paying mechanism via Jito’s bundling infrastructure. Especially useful for arbitrage traders, who can submit bundles of transactions to be executed together. Validators can determine how much gets passed back to the staker via Jito’s Tip Router. Jito tips are sometimes referred to as “MEV tips” or “MEV yield”. 

• Base Fee: The minimum cost to send a transaction, hard coded to 5,000 lamports (0.000005 SOL). Half is burned, half is paid to the validator. Sometimes referred to as the “signature fee”. 

• Vote Fee: The fee paid by validators to attest to the validity of each block, via an on-chain transaction. Hard coded to 5,000 lamports (0.000005 SOL). Vote fees are earned by the current block-producing validator. 

Note: This report will focus on priority fees and Jito tips, as they are the primary sources of REV.

1. REV Quantity

The Numbers: Solana No Longer #1, But Far From Dead

Solana generated $193M of priority fees and Jito tips in Q3, with production mostly steady over the course of the quarter. Notably, Hyperliquid broke Solana’s 9-month streak as the #1 REV-producing blockchain in the month of June.

Source: Blockworks Research, Chain Comparison

While nowhere near Q1’s massive REV numbers, Solana’s blockchain is far from “dead”, with fee-payers still producing significantly more REV than Ethereum in Q3, for example. This, while SOL only has one fourth the market cap of ETH, and two-thirds its staked assets. Food for thought.

Jito Tips in Decline

Breaking down REV into its components, shown below, we can see that declining REV over Q3 was largely due to a decrease in Jito tips, whose share of overall REV in Q3 declined from around 50% to below 30%, as shown in the two charts below. Priority fees, meanwhile, remained mostly steady.

Source: Blockworks Research, Solana Financials

We can’t pinpoint the exact cause for the decline in Jito tips relative to priority fees. But, as our friend Orion puts it:

Source: X.com, @BasedOrion_ 

This obviously reads positive for the Solana Network, but still begs the question: if we are seeing a decrease in Jito tips without an increase in priority fees, does it reflect better efficiency, less on-chain activity, or both? To investigate the answer, let’s turn our attention to the payers of REV:

2. REV Payers

The Numbers: REV Payers Are Diverse

Examining the most popular programs responsible for REV on Solana, it’s apparent that REV is generated by a long tail of on-chain activities, with the top 25 programs only accounting for 42.6% of REV generation. The largest single “sector” identified here is memecoins, with only 14.4% of REV. 

Source: Blockworks Research, Solana: Onchain Activity, October 1st, 2025

Declining Memecoin Trading Mirrors Falling Jito Tips

Let’s turn our eye to dex trading, where the majority of volume comes from SOL <> Stablecoin pairs in Q3. Memecoin trading as a share of dex volume fell by half over the quarter, from 40% to 20%, as shown in the charts below. Perhaps this is the primary cause for the fall of Jito tips? 

Source: Blockworks Research, Solana Dex Activity

One thing is clear: REV as a share of dex volume fell by over 50% over the course of the quarter, as shown below, roughly matching the decline in volume from memecoins. It’s possible that decreasing memecoin trading reduced the prevalence of extreme arbitrage and high-fee trading behaviors, and thus the use of Jito Tips. Traders of long-tail, volatile assets like memecoins are known to tolerate the most slippage and pay the highest fees of any group of traders on Solana. It follows that a decreasing share of dex volume from memecoin trading could be reflected by a decreasing amount of REV per volume traded. 

Source: Blockworks Research, Solana Dex Activity

It’s impossible to pinpoint a single reason for the declining share of REV from Jito tips. But one thing is clear: fewer tips resulted in fewer earnings for stakers, as we’ll explore in the next section.

3. REV Earners

The Numbers: Slicing up the REV Pie

• Validators earned $121M of fees and tips in Q3, a 63% share

• SOL Stakers earned $72M of fees and tips in Q3, a 37% share

The decrease in Jito tips shown earlier resulted in a decreasing share of REV flowing to stakers during Q3, an ongoing trend since the beginning of the year. As shown below, this is the first-ever quarter in which SOL stakers earned less than 50% of Solana’s network revenue.

Source: Blockworks Research, Solana Financials

This increasing lopsidedness in favor of validators has the potential to increase tensions within Solana’s community, possibly leading to renewed governance proposals to amend Solana’s economics. But, as we’ll explore in the next section, there is reason to be hopeful, with a recent improvement to Jito’s Tip Router enabling priority fee sharing, and a Solana Improvement Document (SIMD) promising to enshrine this functionality in the Solana protocol itself. 

90% of Validators Transparently Share Jito Tips With Stakers, But <1% Share Priority Fees 

Now that we’ve examined Solana’s REV-payers, let’s focus on the recipients of that REV. Validators are in control: they produce blocks, collect the tips and fees, and keep a commission for themselves, before passing the rest on to their stakers. Stakers who don’t like a validator’s commission are free to stake with someone else. 

Stakers currently receive the majority of Jito tips, with 90% of validators charging less than 10% a commission on tips. But priority fees are a different story - Jito only recently upgraded their Tip Router to support sharing of priority fees with stakers. As of now, less than 1% of validators have implemented priority fee sharing via Jito’s Tip Router upgrade, as shown below.

Source: Jito, September 16th, 2025

Some validators hesitate to use the Jito’s fee-sharing solution due to tax concerns, as the entire amount first lands on the validator’s wallet before being shared with stakers. There are other solutions, namely Sanctum’s tool for liquid staking tokens (LSTs). But while there are >1,000 such LSTs listed on Sanctum, fee splits are not transparently displayed, can change at any time, and carry added smart contract risk. 

All in all, this means a decline in Jito tips, as we saw earlier, directly results in a decline in revenue to stakers, for whom Jito tips are their only source of REV earnings. 

Priority Fee Sharing, Wen Adoption?  

Jito’s July announcement about the upgraded Tip Router was understated, and quickly overshadowed by fanfare around their BAM announcement a few weeks later. Until now, only three validators have implemented the new priority fee sharing mechanism, all of which are run by Jito themselves. This is shown below, by our own vibe-coded dashboard which sources data from Rated and Trillium APIs and is updated every 24 hours. 

Source: solsharing.com, September 19th, 2025

One sure-fire way to push adoption of fee-sharing is to mandate it for validators receiving stake from the jitoSOL stake pool. Jito took the first step, beginning to track priority fee sharing within StakeNet, but didn’t mandate it. Their explanation was that they’d “paused the implementation to accommodate market conditions, after listening to feedback from validators.” Presumably, if REV increases again to Q1 levels, Jito will implement a mandate for validators receiving stake from jitoSOL to share their priority fees. 

However, an in-protocol solution is on the way: 

SIMD-123 Implementation Will Begin Stakers’ REV Renaissance

SIMD-123 is Solana’s in-protocol mechanism for priority fee sharing, currently under development. It was approved via governance vote in March, but its implementation has been slow, with additional dependencies including SIMD-180 and SIMD-185. It seems increasingly likely that SIMD-123 won’t be implemented on mainnet before 2026.

Once SIMD-123 is implemented, validators will be able to share priority fees without installing additional Jito software - the functionality will be available via the Solana validator client. Stake pools will likewise be able to mandate in-protocol priority fee sharing without relying on Jito’s tech and paying fees.

We hope that the successful implementation of SIMD-123 will begin the normalization of priority fee sharing, resulting in a larger share of REV being shared with SOL stakers.

Validators and SFDP Will Need to Re-assess Fees

As validators begin to implement priority fee sharing, awareness from stakers will increase, and fee sharing will become the “new normal”. Validators will be able to advertise higher APYs to their stakers in an effort to compete and gain additional stake. 

To avoid a “race to the bottom” totally stripping away validators’ revenues, validators may increase their commission on voting rewards, paid out by the Solana protocol as inflationary issuance of new SOL tokens. Increased validator commission on voting in exchange for more priority fees for stakers would increase the volatility of stakers APY, but create upside, aligning stakers with Solana’s on-chain REV production. 

Validators participating in the Solana Foundation Delegation Program (SFDP), though, must contend with a 5% limit on voting reward commission and a 10% limit on MEV commission, but no guidance on priority fee collection. 

Source: Solana Foundation

For priority fee sharing to become widely adopted, SFDP will need to take a broader view of the “total rewards” generated by a validator, allowing for higher voting reward commission in exchange for mandating some sharing of priority fees. It’s worth noting that there are several stake pools which closely mirror the SFDP’s fee structure.

When asked about this, the Head of Staking Ecosystem at Solana Foundation, Ben Hawkins, commented that fee limit amendments are possible in the future, but the Foundation would wait until successful SIMD-123 implementation makes available an in-protocol fee sharing mechanism. 

4. Coming Soon To Solana’s Economy

Reductions in memecoin trading, Jito tips, and staker revenue. Is this the beginning of the end for Solana’s REV? We don’t think so. There are many structural changes coming to Solana’s economy, which are (mostly) bullish for REV and staker revenue.

Increased On-chain Activity

Solana's usage is clearly increasing in the long term. Solana’s transaction count, shown below, is trending toward an average of 1,000 successful, non-voting transactions per second. 

Source: Blockworks Research, Solana Onchain Activity

Stablecoin supply has also ballooned, with $14B of supply representing a 500% increase within the past 24 months, shown below. Supportive regulations in the US and beyond create further tailwinds for this trend. 

Source: Blockworks Research, Solana Onchain Activity

Crypto-native applications in decentralized finance (DeFi) are also enjoying tailwinds, with the share of liquid staked SOL rising toward 15%. An all time high of SOL locked in DeFi protocols, shown below, also signals increasing on-chain activity. 

Source: DeFi Llama

Solana’s chain is increasingly a chain of users and use cases, creating optimism for increased usage and REV generation in the future. 

More Efficient Validator Clients

To complement increasing REV, a slew of projects are working to optimize validators’ efficient REV collection. Firedancer's new revenue scheduler, as well as projects like Paladin, Raiku, Spur, and Rakurai, all advertise increased per-block revenues. 

Source: Rakurai Blog

Increased CU Limit

To keep computational requirements for validators under control, the Solana protocol limits the maximum number of Compute Units (CUs) that can fit into a single block. This, naturally, also limits the maximum throughput of activity. An ongoing effort to raise the CU limit successfully increased CUs/block to 50M, and then 60M, and now SIMD-286 proposes raising it to 100M CUs/block.

Research from Rated Network estimated that the increase from 50M to 100 M could triple the current block reward, if validators can consistently fill blocks. If combined with an increase in REV generation, and the implementation of SIMD-123, this would mean significantly higher earnings for stakers. 

However, if on-chain demand for CUs does not reach the limits, higher limits do nothing to boost validator and staker revenues. As shown below, stagnant demand limited the effects of the increase to 60M CUs.

Source: Blockworks Research, Solana Onchain Activity 

Are increased CUs a matter of “build it and they will come”, or would an increase to 100M actually reduce the need to pay high fees for blockspace? Only time will tell. Taken together with increases in CU efficiency thanks to improvements like P-tokens, what’s good for the network may turn out to be bad for staker revenue. 

Reduced Issuance

Although reducing the issuance of new SOL tokens doesn’t change the amount of REV, it does elevate the share of stakers’ overall APY from REV. This would make staker APY more volatile, elevating awareness and mindshare around REV sharing, and perhaps accelerating the adoption of priority-fee sharing amongst validators. 

Source: Dune, 21labs, Staking: Overview

Earlier this year, SIMD-228 came close to significantly reducing Solana's issuance, just falling short of the required quorum to pass. Many in the community believe it's only a matter of time until another proposal successfully reduces Solana's issuance, making REV a larger part of the default staking yield. (One very recent piece of research by Gurnoor Narula highlights that reducing issuance could also benefit stake distribution and thus network decentralization.)

Jito’s Block Auction Marketplace (BAM)

Jito’s BAM, while still in the early phases, has the potential to totally change the dynamics of MEV collection and distribution on Solana. BAM separates the block building / transaction ordering role from validators, reducing their importance. Jito’s commitment to eventually open-sourcing BAM introduces the possibility for other implementations and fee-sharing models. 

Alpenglow 

Another massive change coming to Solana is the new consensus algorithm, Alpenglow. While the full scope of Alpenglow’s changes are too much for this report, one key change is the removal, or reduction of voting fees for validators. Currently, each validator spends ~1 SOL/day ($85k/year at current prices) in fees to vote on the validity of blocks, which is several times the hardware cost. A total removal of voting fees is unlikely, instead a “Validator Admission Ticket” might be required to be paid at the beginning of each epoch, to prevent sybil attacks and other malicious activities. We hope that, regardless of which form it takes, reduced cost to validators would result in willingness to share more priority fees with stakers.

5. Conclusion: Stakers Fight Headwinds, But RevTec Can Help

In summary, Solana’s on-chain activity remained subdued in Q3 of 2025, but still generated a meaningful amount of REV for stakers and validators. Jito tips, earned by stakers, fell as a share of REV, while validators continued to earn a relatively stable stream of priority fees. While priority-fee sharing has been enabled in Jito’s Tip Router, >99% of validators don’t yet share priority fees with stakers. The eventual implementation of SIMD-123 offers an in-protocol method of fee sharing, with adoption from validators likely to increase following mandates from stake pools and fresh increases in REV on-chain. 

To dive deeper into the state of REV on Solana and what’s ahead, join our livestream on October 2nd at 18:00 UTC, featuring Brian Smith from Jito, and others. 

Sign up here: https://luma.com/lgy552kf

For stakers wishing to concentrate their capital on earning Jito tips and priority fees, we’re building RevTec. A Solana staking protocol with two liquid staking tokens, revSOL and issSOL, RevTec enables stakers to choose between earning REV, or inflationary issuance. With four times the amount of REV yield as default staking, revSOL is composable with other DeFi protocols and backed by SOL. Our hope is that, by differentiating Solana’s staking yield, we can attract new types of investors to Solana, and build new yield products. Sign up to be notified of our mainnet launch.