Jupiter & Helium Challenge Token Buyback Strategies — Understanding Why They Often Fail in Crypto

Token buyback strategies, while seemingly effective in theory, often struggle in the cryptocurrency market. Recent actions by Jupiter and Helium highlight this issue as both projects reconsider their buyback programs after substantial financial expenditures led to minimal changes in token prices.

Key Takeaways

Jupiter and Helium are rethinking their token buyback initiatives after significant spending with limited market response.
Helium has paused its buybacks funded by mobile revenue due to insufficient market impact.
Jupiter has also faced challenges, with a drastic decline in JUP’s value despite extensive buyback activities.
The core issue revolves around supply and demand dynamics, which undermine the effectiveness of buybacks.
Buybacks require strong utility or direct benefits for token holders to be successful, otherwise, they may serve as short-term exit options for traders.

Jupiter & Helium Expose Token Buyback "Meta" — Why It Never Works in Crypto

Token Buyback Strategies Under Scrutiny

Jupiter and Helium's Shift in Approach

In January, Helium announced a halt to its HNT token buybacks, which were previously supported by revenue from Helium Mobile, despite generating $3.4 million in October 2025. Founder Amir Haleem noted that the market showed little reaction to these purchases, prompting a shift in focus towards subscriber growth, hardware improvements, and increasing carrier offload usage.

Previously, Helium switched to daily automated buybacks in late 2025, utilizing funds from mobile subscriptions and network usage to burn tokens. While the initiative managed to decrease the token supply, the buybacks from mobile revenue are now on hold.

Similarly, the Solana-based DEX aggregator Jupiter has spent more than $70 million on JUP buybacks in 2025, utilizing about half of its protocol fee revenue. With JUP's price dropping nearly 90% to about $0.21 since its peak in early 2024, Jupiter's founder Siong has initiated discussions within the community about ceasing the buyback program.

At the center of these issues is the increasing supply of tokens. Jupiter has seen a notable expansion in its circulating supply due to airdrops, staking rewards, and other scheduled unlocks, with approximately 700 million JUP added to circulation by January 2025. While buybacks have been enacted, they only somewhat mitigate the influx of new tokens.

The Limitations of Buybacks in Sustaining Crypto Value

Critics of the buyback approach in Solana DeFi argue that buying tokens from the open market offers limited benefit when the new token supply continually exceeds buybacks. In this scenario, buybacks tend to serve as liquidity for sellers rather than factors that create long-term value.

Additionally, many market participants believe that buybacks are most effective when they accompany reasons for holding a token, such as mandatory uses, reduced emissions, or direct cash flow participation. Without these incentives, traders are likely to sell their tokens during predictable buyback periods.

On the flip side, proponents of buybacks contend they are not fundamentally flawed. In traditional finance, buybacks aim to redistribute excess capital when a company's equity is undervalued—not to counteract significant ownership dilution.

In the case of Helium, the challenge lies in connecting its off-chain growth with on-chain value. With nearly 600,000 mobile subscribers, Helium generates consistent data credit burns via carrier offload transactions.

Helium’s Network Activity

Currently, Helium is focused on enhancing actual usage with the hope that increasing network activity will strengthen the economics behind its tokens. Future buybacks may become viable if the company's growth significantly outpaces token issuance.

In contrast, Jupiter's situation is multifaceted. As one of the most lucrative DeFi platforms, it boasts significant liquidity, high total value locked (TVL), and a broad range of products, including perpetuals, lending, and a mobile wallet. However, the JUP token remains largely optional for users.

Jupiter’s Competitive Position

Analysts suggest that without better integration of the JUP token into the protocol’s essential functions, buybacks cannot adequately counter inflation or solidify token value.

Ongoing discussions within the ecosystem are focused on reducing emissions, linking rewards to revenue generation, and redesigning JUP as an essential asset for serious users instead of a mere passive governance token.