How BAM Brings Institutions Onchain
Perhaps the defining narrative of the 2024-25 crypto bull market has been the acceleration in adoption from traditional financial institutions. Headline events include the approval and trading of spot cryptocurrency ETFs, an uptick in real world asset tokenization, and multiple banks and asset managers exploring stablecoin rails for payments settlement.
However, to date many institutional capital allocators have relied on custodians, centralized exchanges, and other intermediaries to provide or access these services, and have largely stayed off-chain, avoiding DeFi and other protocols. This is because of key market structure and regulatory differences between onchain and offchain economies – differences that Jito’s Block Assembly Marketplace (BAM) can play a major role in solving.
This blog will explore some of the obligations that institutional capital entities have to their clients, breaking down why most of the world’s capital has stayed off-chain, and why BAM can help mitigate these problems to bring a new wave of capital efficiency to onchain environments.
The Problems: Why Institutions Can’t Just Swap Onchain
For individual traders, swapping tokens onchain is simple: connect your wallet, click “swap,” and you’re done. But for institutions—like hedge funds, asset managers, or trading firms—the bar is much higher. They manage billions of dollars of client money, and that comes with strict rules about how they trade.
Here are the biggest blockers keeping them out of DeFi today:
- Regulatory Standards (Best Execution Obligations)
- In traditional finance, institutions must prove that every trade was executed in the best possible way for their clients. This is called Best Execution, or “BestEx.”
- They back this up with Transaction Cost Analysis (TCA)—basically detailed receipts that show their trade price compared to the broader market.
- Onchain, this is nearly impossible today. There’s no universally accepted benchmark price, no consolidated order book, and no easy way to show that you truly got the “best” fill available.
- Unpredictable Transaction Ordering
- On Solana (and most blockchains), validators control the final order of transactions in each block.
- This means your trade can be reordered or front-run before it lands onchain. For institutions, that uncertainty is unacceptable. They can’t put client funds at risk of being sandwiched or manipulated in ways they can’t prove or defend later.
- Auditability and Compliance
- Institutional trading must be auditable. Firms need proof they followed the rules and acted in clients’ best interests.
- Right now, DeFi doesn’t provide those kinds of receipts. If a regulator asks, “Can you prove you didn’t trade through a sanctioned entity, or that you got the best available execution?” institutions have no airtight answer.
The bottom line: it’s not that institutions don’t want to trade onchain—it’s that the infrastructure hasn’t given them the same transparency, control, and auditability they already have in traditional markets. Until those gaps are closed, they are unable from a practical perspective to access onchain liquidity and services.
Enter BAM: Shortening the Gap Between Intent and Execution
The Block Assembly Marketplace (BAM) is the Jito Network’s answer to this problem. On Solana, validators currently control the order in which transactions get included in a block. That gap—between the moment you submit a trade and the moment it’s locked onchain—leaves room for interference.
BAM changes this by introducing a new layer: the BAM node. Instead of leaving sequencing entirely up to validators, BAM plug-ins handle the packaging and ordering of transactions before they hit the chain. That means what you intend when you hit “trade” is what actually gets recorded—without detours, delays, or hidden hands.
For institutions, this is critical. It gives them the transparency, auditability, and trust they need to bring real money onchain.
Why That Matters for Everyone
Here’s the exciting part: when institutions join onchain markets, everyone benefits. More capital onchain means:
- Deeper liquidity – it’s easier to trade without moving the price.
- Tighter spreads – the gap between buying and selling prices shrinks, saving traders money.
- Better price discovery – markets reflect real value more accurately.
- New opportunities – more players, more strategies, and more efficient markets overall.
In short: BAM makes Solana more welcoming for serious capital. And when professional money managers start trading side-by-side in a frictionless, open ecosystem, the onchain economy grows closer than ever to attaining the goal of a decentralized NASDAQ.