Kamino Finance has a lot going for it. $16 billion in loans issued. Zero bad debt. And a governance token trading more than 92% below its all-time high.
That’s awkward.
That gap between how the protocol performs and how its token performs is where most Kamino explainers on the internet quietly stop being useful.
Hopefully, this post of mine goes the other way – into the mechanics. How Kamino lending pools price money, what its crypto vaults automate on your behalf, and where the risk actually sits when the market turns. Less about what Kamino calls itself, more about what the contracts do when your collateral drops 18% overnight.
Key Takeaways
- Kamino Finance has issued $16B in loans with zero bad debt since launching lending in 2023.
- TVL fell from a ~$2.8B peak in Q3 2025 to roughly $1.5B by April 2026, tracking SOL’s price and a sector-wide deleveraging.
- Jito, not Kamino, has held Solana’s top total-TVL slot for much of 2026. Kamino leads the lending category.
- Roughly 65% of protocol TVL sits in lending pools, with the balance in crypto vaults.
- KMNO trades about 92.8% below its December 2024 high despite growing protocol usage.
What Is Kamino Finance?
For the uninitiated – Kamino Finance is a Solana-native DeFi protocol that bundles a lending market, automated liquidity vaults, and leveraged yield strategies into a single app. It launched in August 2022 as an automated concentrated liquidity manager, spun out of Hubble Protocol. And then added their lending feature, K-Lend, in 2023.
Today it runs four connected product lines:
- Lend: Supply assets to earn interest, or post collateral and borrow against it.
- Liquidity: Automated concentrated liquidity vaults that manage LP positions on Orca and Raydium.
- Multiply: One-click looped leverage, mostly on liquid staking tokens.
- Long/Short: Directional leverage built on the same borrow rails.
Kamino’s edge is consolidation. Instead of manually rebalancing an LP position on one app and refinancing a loan on another, Kamino Finance handles the coordination inside a single interface. But whether that’s worth the extra contract surface is a different question.
Kamino isn’t a lending protocol with attached vaults, and that’s something worth holding onto. The vaults and the lending pools are the same balance sheet, which is exactly why the leverage products work.
Where Kamino Finance Sits in the Solana Ecosystem
Kamino Finance is the largest lending venue in the Solana ecosystem, but calling it the largest DeFi protocol on Solana needs a warning sign in 2026. By total value locked, Jito has held the top slot for much of the year on the strength of liquid staking and MEV capture. Kamino leads the lending and yield category.
| Date | Kamino Finance TVL | Source |
| Q3 2025 (peak) | ~$2.8B, up 33% QoQ | BlockEden Q1 2026 report |
| Q1 2026 | ~$1.72B | CoinMarketCap AI |
| April 2026 | ~$1.48B | DefiLlama |
Obviously – figures move daily with SOL’s price, so please treat any TVL number in an article as a timestamp rather than a fact.
Two structural points explain why this protocol exists on Solana specifically:
- Fees make automation viable: Auto-rebalancing a concentrated liquidity position means dozens of transactions per month. At sub-cent fees and 400ms finality, that overhead is rounding error. And on Ethereum mainnet, gas would eat the yield the rebalancing is meant to capture.
- Collateral is concentrated in yield-bearing assets: JitoSOL, JLP, USDC, and SOL dominate the deposits, which is what makes Kamino’s looping strategies economically interesting.
The 2026 development is institutional. Kamino, Anchorage Digital, and Solana Company launched a tri-party custody model that lets institutions borrow against natively staked SOL held in qualified custody. That is a different customer than the yield farmer the docs were originally written for.
How Kamino Lending Pools Work: Supply, Borrow, and Liquidation
Kamino Finance lending pools run on a utilization-driven interest rate model, which is standard for DeFi lending. It comes with a couple of additions that are worth understanding; elevation mode and isolated markets. Roughly 65% of protocol TVL sits in K-Lend, with the remainder in liquidity vaults.
| Asset | Typical supply APY (2026 range) | Driver |
| USDC | ~4% to 9% | Leveraged long demand |
| SOL | Lower, more stable | Looping demand from LST holders |
| PYUSD | Similar to USDC, thinner depth | Listed since 2025 |
Rates change hourly. Check the live dashboard before you commit capital to any figure printed in a blog post, including this one.
Supplying assets to Kamino lending pools
When you deposit into Kamino lending pools, you receive a receipt token representing your share of the pool plus the accrued interest. Your yield comes from borrowers, and the rate tracks utilization: the share of supplied assets currently borrowed.
The curve has a kink below the optimal utilization point. From there, the rates start going upwards. And above it, they climb steeply to push borrowers toward repayment and protect withdrawal liquidity.
That’s why USDC supply APY swings so widely. Stablecoin borrowing spikes when SOL rallies and traders lever long, and it collapses when they deleverage.
Borrowing, LTV, and liquidation thresholds
Here’s some math, using round numbers to keep it easy.
Say you deposit 10 SOL at $130, so $1,300 of collateral. At a 70% max loan-to-value ratio, you can borrow up to $910 USDC. Say you borrow $800, putting you at 61.5% LTV.
Your liquidation threshold is 75%. That threshold is reached when your collateral value falls to $1,067, which happens when SOL hits roughly $107. An 18% drawdown, well inside a normal week in this market.
At that point:
- Any bot can repay part of your debt and seize collateral. Liquidations are permissionless, and liquidators compete for the penalty.
- The penalty is roughly 5% of the liquidated amount.
- Kamino Finance liquidates partially rather than closing your whole position. So, a single dip doesn’t wipe the whole account automatically.
Elevation mode and isolated markets
Elevation mode raises the max LTV for correlated asset pairs. And posting jitoSOL and borrowing SOL carries far less risk of price divergence than posting SOL and borrowing a volatile altcoin. So, the protocol permits higher leverage on that pair.
It comes with some real trade-offs. The higher the LTV, the smaller the buffer. And correlated doesn’t mean identical. An LST depeg, even a temporary liquidity-driven one, hits eMode positions first.
Isolated markets solve the opposite problem. Long-tail assets get their own pool so a bad listing can’t drain the main market. There, the yields are higher because the risk isn’t socialized.
How Kamino’s Crypto Vaults Actually Work
Kamino’s crypto vaults automate positions that most people manage badly by hand. Each vault type does one job, and they differ enormously in risk.
| Vault type | What it automates | Risk level |
| Liquidity Vaults | CLMM range management and fee compounding | Moderate, impermanent loss |
| Earn Vaults | Curated capital allocation across strategies | Moderate, curator dependent |
| Multiply / Long-Short | Recursive borrow and re-deposit loops | High, liquidation exposure |
Automated liquidity vaults and CLMM rebalancing
Concentrated liquidity lets you place capital in a specific price band instead of across the whole curve. Inside the band you earn outsized fees. Outside it, you earn nothing and hold 100% of the worse-performing asset.
Picture a market stall that only sells when the price is between $95 and $105. When the market moves to $120, your stall sits empty.
Kamino’s automated liquidity vaults, the protocol’s original August 2022 product, shift that band as price moves and compound earned fees back into the position on Orca and Raydium. Automation does not remove impermanent loss. It removes the part where you forget to rebalance for three weeks.
Earn Vaults and the curator model
Earn Vaults introduced a Vault Layer alongside the Market Layer in the K-Lend V2 upgrade. The structural change is what sets the risk parameters. 3rd-party curators, including risk firm Gauntlet, allocate deposits and define the exposure limits. And with roughly $140 million is managed across Kamino by Gauntlet.
The CASH vault runs delta-neutral strategies designed to generate yield with limited price exposure. And the traction has been meaningful. Earn Vault deposits crossed $300M during the 4th season, with lenders earning over $1M in rewards.
What you are actually buying is a curator’s judgment. That is a different risk from smart contract risk, and it is not covered by an audit.
Multiply and long/short Leverage vaults
Multiply automates looping. You deposit an LST, the vault borrows SOL against it, swaps that SOL back into the LST, re-deposits, and repeats until it hits your target leverage. Your staking yield multiplies. So does everything else.
Long/Short applies the same borrow rails to directional bets.
But, a warning: the leveraged vaults are where retail users lose money on Kamino Finance. Looping compresses your liquidation buffer with every cycle. A 5x looped LST position can be liquidated on a move that a spot holder wouldn’t notice, and an LST discount on secondary markets can trigger it even when SOL itself has not moved.
Kamino Finance vs Jupiter Lend, Save, and MarginFi: Solana DeFi Compared
| Protocol | Approx. TVL (2026) | Standout feature | Main weakness |
| Kamino Finance | $1.5B to $1.7B | Lending, vaults, and leverage on one balance sheet | Complexity stacking; TVL down ~45% from peak |
| Jupiter Lend | $1.5B+ (Dec 2025) | High LTV, integrated with Jupiter perps | Newer codebase, shorter track record |
| MarginFi | ~$450M | Isolated eMode pairs with tight LST/SOL rates | Thin liquidity outside LST pairs |
| Save (ex-Solend) | ~$75M | Long-tail asset coverage, audits back to 2021 | Small pools, no structured products |
The competitive story in Solana DeFi lending during 2026 is Jupiter Lend. It hit $500 million in TVL within 24 hours of its August 2025 launch and crossed $1.5 billion by December 2025, roughly 35% of Solana’s lending market. The rivalry got heated enough that Solana Foundation president Lily Liu publicly stepped into the dispute. Blockeden
In my opinion, Kamino Finance wins on product depth and institutional integrations. But Jupiter Lend wins on distribution. Because it’s based inside an app most Solana users open daily. And distribution usually beats depth in the long term, which is exactly why Kamino’s pivot to RWA looks more like a necessity.
KMNO Tokenomics, Staking, and Governance
The KMNO token has performed badly, and pretending otherwise would undercut everything else on this page.
- Max supply is 10 billion, with roughly 3.15 billion circulating.
- Price sat near $0.018 with a market cap around more than $91M around July 2026.
- The all-time high was ~$0.247 way back in December 2024, and the all-time low was ~$0.0134 recently in 2026 – a drawdown of about 92.8%. Oof.
- A 229 million KMNO unlock landed in April 2026, adding supply into an already weak market.
- KMNO listed on the Korean exchange Upbit in June this year, which broadened access without reversing the trend.
Utility runs through three channels; one is governance voting, second is staking to boost yields, and the third is seasonal points programs that distribute rewards to active users.
Honestly, KMNO’s price has decoupled from protocol usage. Loans originated kept growing while the token fell more than 90%. If you are evaluating Kamino, evaluate the protocol and the token as two separate decisions, because the market currently does.
Risks of Using Kamino Finance
Kamino has a clean security record and a real risk surface. And both are true.
- Smart contract risk: Audited by OtterSec, Halborn, and Offside, with a fourth formal verification of Kamino Lend completed by mid-2026. No major exploit through 2026.
- Oracle risk: Positions liquidate on oracle prices. A stale or manipulated feed during volatility can trigger liquidations that spot prices wouldn’t justify.
- Liquidity crunch risk: During the April 2026 deleveraging that followed the KelpDAO exploit, Kamino’s USDC markets hit 100% utilization. And at full utilization, suppliers can’t withdraw until borrowers repay or any new deposits arrive.
- Curator risk: Earn Vault depositors inherit the parameter choices of whoever curates that vault. Audits don’t cover bad allocation decisions.
- Token dilution: And with about $3.15B of $10B supply circulating, future unlocks remain a structural overhang.
When Kamino Finance is the wrong choice: If you hold around $500 and want passive stablecoin yield, gas-free looping doesn’t offset the attention cost. You’ll spend more time monitoring a health factor than the extra two points of APY are worth. So here, a plain custodial or single-asset yield product serves you better.
How to Start Using Kamino Finance
- Install a Solana wallet such as Phantom or Solflare.
- Fund it with SOL for transaction fees, plus whatever asset you plan to deposit.
- Connect the wallet at app.kamino.finance and verify the URL character by character.
- Start in Lend, not Multiply. Supply USDC or SOL and watch how rates move for a week.
- Check the market’s utilization rate before depositing, since high utilization means withdrawal delays.
- If you borrow, set a personal LTV ceiling well below the liquidation threshold, around 50% rather than 70%.
- Monitor your health factor after any sharp SOL move.
- Only after all of that, consider liquidity vaults, and treat leverage vaults as a separate decision entirely.
The order matters. Most losses on lending protocols come from people who started at step eight.
Final Thoughts
Kamino suits one type of user very well – someone who’s already holding SOL or an LST who wants borrowing power and automated LP management without juggling 4 apps. And for that person, the integration is worth more than the extra contract exposure.
It suits passive stablecoin savers poorly. The yield doesn’t compensate for utilization risk and monitoring overhead at small position sizes.
The variable I would track is the December 2025 institutional pivot, which added fixed-rate loans, a private credit vault, and an RWA DEX. If tokenized credit volume shows up on those rails, Kamino Finance stops competing with Jupiter Lend for the same retail deposits and starts running a different business. But if it doesn’t, Kamino defends a shrinking share of Solana DeFi lending against a rival with better distribution.
FAQs
It has never been exploited and has been audited by OtterSec, Halborn, Offside, and four formal verifications. Smart contract, oracle, and liquidation risks continue to be present.
It is Solana’s largest lending protocol. By total TVL in 2026, Jito has generally ranked higher on the strength of liquid staking.
The protocol takes a cut of borrower interest paid in lending pools, plus performance and management fees on its automated crypto vaults.
Lend is the base money market where you supply or borrow. Vaults are automated strategies built on top of that market.
Yes. Liquidity vaults have impermanent loss, and leveraged Multiply vaults can get liquidated during large market drawdowns or an LST discount.
Governance voting, staking to boost yields, and earning seasonal rewards. It does not entitle holders to direct protocol revenue.
Kamino offers a deeper product range and institutional integrations. Jupiter Lend offers higher LTV ratios and distribution through Jupiter’s existing user base.
