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Role within the vault

After the staking leg, the vault holds a liquid staking token (jitoSOL or mSOL). The lending leg supplies that token as collateral on a lending market and borrows SOL against it. A portion of the borrowed SOL is restaked into the same LST; the remainder funds the perpetual hedge. The leg simultaneously earns three rates: When the sum of income components exceeds the borrow cost, the leg adds yield to the vault. The protocol selects configurations where this has been the case across the live history of the supported venues.

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Supported markets

The lending leg currently runs on Kamino Lend. Kamino is a Solana lending market with on-chain liquidity, public reserves, and well-documented liquidation parameters. The vault uses Kamino because:
  • It accepts jitoSOL and mSOL as supply collateral with reasonable loan-to-value caps.
  • Its borrow rate model is curve-based and updates continuously with utilisation, which makes the spread predictable.
  • It exposes a programmatic interface that the worker can use without manual intervention.
When the additional markets come online, vaults route to whichever venue offers the best risk-adjusted spread at the moment of execution, subject to the constraints in the policy.

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Loan-to-value and liquidation buffer

The vault never operates at the maximum loan-to-value that Kamino permits. The policy bakes in a buffer between the working LTV and the liquidation threshold so that ordinary market moves do not trigger a forced unwind. The buffer is calibrated so that:
  • Routine volatility does not bring the position close to liquidation.
  • A large adverse move triggers a rebalance, not a liquidation.
  • The worker has time to act before any external party can step in.
The exact buffer and rebalance thresholds are part of the policy extension and visible on chain once a vault is created. They are not published in aggregate because they would compose into the strategy signature.

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Why the spread is usually positive

Lending markets price borrow rates above supply rates. The vault is on both sides of the same market: it supplies a yield-bearing token (earning the supply rate plus the underlying staking yield) and borrows SOL (paying the SOL borrow rate). Across history, the supply yield plus the staking yield on the collateral has exceeded the borrow rate on SOL by a workable margin on Kamino. When the spread compresses or inverts, the worker reduces the size of the lending leg. When it widens, the worker can extend the leg back to its normal range. The decision is made within the policy bounds; nothing the worker does can move outside them.

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Worker response to rate changes

Every response is bounded by the policy extension. There is no override path.

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Perpetual markets

The hedge leg that pairs with the long SOL exposure introduced here.

Custody and policy

Where the LTV buffer, leverage cap, and rebalance thresholds live inside the policy extension.