Allez

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March was marked by continued market volatility, driving a contraction in activity across Kamino Lend. Total monthly volume fell to $5B, representing a 37.7% month-over-month decline. The USD value of supply, debt, and TVL also declined modestly (–4.8%, –1.2%, and –7.2% respectively), primarily due to price contractions and user deleveraging. This was reflected in a significant drop in borrow interest revenue, down 36.5% to $6.6M.

Despite the challenging conditions, liquidity stuck around; both stablecoin and SOL markets recorded nominal growth. By the end of March, stable supply reached $729M (+5.2% MoM), while SOL supply rose to 4.76M (+1.7% MoM), ($595M). The number of active positions (155k) and unique wallets (130k) remained stable.

Kamino users also demonstrated prudent risk management. While $19.4M in collateral was seized (–44.8% MoM), this represented a record 0.75% of total volume - highlighting the system’s ability to process liquidations effectively even in turbulent conditions. Notably, JLP collateral accounted for over half the liquidations with $10.4M, followed by SOL positions at $7.7M.

The month also brought meaningful protocol improvements: Max JLP leverage was raised to 6x, Squad X integrations launched to support institutional adoption, and the $USDG growth initiative began rolling out with generous borrow incentives.

🔎 Check out the March Monthly Snapshot for more details.

1. Overview of Market Performance

March was defined by heightened volatility across crypto markets, with sol oscillating between $114 and $150. Total deposits dropped 4.8% to $2.7B, and borrowing decreased slightly to $1.1B (–1.2% MoM), resulting in a 7.2% decline in total value locked (TVL), which ended the month at $1.6B.

Despite these headwinds, user retention was high with the number of active positions (155k) and unique wallets (130k) holding firm. Stablecoin and SOL markets continued to grow in nominal terms. Stable supply climbed to $729M (+5.2% MoM), with deposits yielding 3.7%, while SOL supply increased to 4.76M SOL (+1.7% MoM), generating 3.6% for depositers.

SOL reached a yearly low of $114 during March, triggering deleveraging across Kamino markets. This resulted in liquidation activity, most notably in the JLP market where $10.1M of the $19.4M total seized collateral originated. Nevertheless, the protocol’s liquidation infrastructure performed well, with the expanding liquidator ecosystem continuing to safeguard solvency and maintain system integrity.

Kamino continued to build throughout March, launching several key upgrades:

JLP Leverage Upgrade: Maximum leverage increased to 6x to enhance capital efficiency.

Squad X Integrations: Rolled out to support institutional adoption and improve composability.

USDG Growth Initiative: Deployed with attractive borrow incentives to diversify stablecoin use across the platform.

Together, these developments reflect Kamino’s continued focus on resilience and innovation, even as macro conditions introduce short-term headwinds.

2. Supply, Borrowing & Revenue Trends

Across markets, supply and borrowing activity remained resilient. The Main market retained its leadership with $1.7B in supply (–4.2% MoM) and $694M in debt. JLP followed with $671M in supply (–7% MoM) and $217M in debt, while Jito saw more volatility, with $294M in supply (–20% MoM) and $148M in debt.

Liquidity across markets remained remarkably stable despite negative price action. In fact the markets experienced net nominal growth in SOL, with higher supply of SOL & JupSOL as well as the newly launched stablecoins FDUSD & USDG.

Despite lower overall demand, protocol revenue remained solid. Kamino generated $6.7M in interest from borrowers in March (–24% MoM), supported by sticky liquidity and organic demand across stablecoin and SOL markets.

3. Kamino Stable Dollar & SOL

March experienced minor fluctuations in borrow rates—particularly in the SOL market, where sharp intraday spikes were followed by rapid normalization. Despite turbulent market conditions, demand for SOL-denominated leverage remained strong. SOL borrow volume increased 8% month-over-month to 3.8M, while total SOL supply remained stable at 4.7M (+1.7% MoM), supporting continued risk-adjusted yield.

On the stable side, both Kamino Stable Dollar supply and debt posted healthy growth. Stable supply reached $729M (+5.2% MoM) while debt rose to $530M (+2% MoM). Utilization declined slightly from 75% to 72.4%, a signal of platform-wide deleveraging. Correspondingly, Kamino Dollar supply rates dropped from 4.3% to 3.7%, reflecting the easing borrowing pressure.

Stablecoin diversification advanced this month. FDUSD and USDG both grew meaningfully, benefiting from ecosystem incentives. In contrast, PYUSD saw a sharp contraction as incentives tapered off. Meanwhile, USDC staged a modest recovery after February’s decline, contributing to a more balanced and resilient stablecoin mix across the platform.

4. Transaction Volume and User Behavior

Kamino processed a total of $5B in transaction volume during March (-37%MoM), reflecting less user activity. Deposits led at $2B (-33.3%MoM), followed by withdrawals at $1.9B (-35.4%MoM), and borrows at $617M (-30%MoM). Repays accounted for $551M (-43%MoM), while liquidations remained modest at $38.1M — further emphasizing the protocol’s strong collateral management and risk controls.

Overall, this activity distribution indicates continued engagement in Kamino’s core markets. Even amid macro uncertainty, users actively managed risks — shifting collateral, adjusting leverage, and exiting or entering positions. The data underscores the protocol’s role as a stable and efficient venue for DeFi lending activity through the market cycles.

5. Market Movements & Liquidations

SOL hit its lowest price in the past year at $114 during March with 17.9% average drop across listed assets, intensifying deleveraging trends across Kamino markets. This led to increased liquidation activity, particularly in JLP, which accounted for $10.4M of the total $19.4M in seized collateral.

The liquidator ecosystem expanded to 113 active participants (+41% MoM), processing 12,683 liquidations with no bad debt. Notably, the top liquidator seized $5.1M in collateral, while six others each handled over $1M. Liquidation bonuses remained contained, indicating prompt processing of risky positions.

6. Stress Testing

In March, most markets shifted towards higher risk, with user positions clustering closer to liquidation thresholds compared to February. Main, JLP, and Altcoin markets all saw increased concentration in the 20–30% distance range, indicating greater leverage or reduced collateral buffers. March distance to liquidation reflects a trend toward thinner safety margins across most markets.

In case of market shock, the largest exposures —USDC and SOL— would likely be repaid first in a liquidation scenario, they are also most liquid assets able to sustain large transactions. The price impact has remained stable through this period of market volatility.

Total Collateral at Risk & Bad Debt Exposure (ceteris paribus):

Should a 30% market drop occur, $348M in collateral could be liquidated (+37% MoM), potentially resulting in $13.3M in bad debt (+280% MoM)

In a 60% crash scenario, liquidation exposure rises to $844M (+2.5% MoM), with potential bad debt reaching $143M (+22% MoM)

These increases underscore the reduced margin of safety across user portfolios.

7. Conclusions & Risk Considerations

Market turbulence continues to test Kamino’s risk systems, which continue to be effective The protocol Kamino’s systems performed well under pressure, with efficient liquidation handling and a growing network of liquidators. User behavior demonstrated increased risk awareness, and core markets - such as SOL and stables - remained active despite market turbulence.

With utilization and leverage both down, Kamino’s ecosystem is more resilient but also more sensitive to further volatility. Ongoing monitoring of liquidation distances, market activity, and stablecoin flows will be critical in the months ahead.

Kamino remains well-positioned for recovery and continued growth as markets stabilize.

Key risk takeaways:

The reduction in leverage and utilization rates across markets continues. The market conditions continue to impact user margins.

Liquidation mechanisms operated as intended keeping liquidation bonus in the lower range. The liquidator landscape continues to grow with now 113 players across markets.

FDUSD & USDG show significant growth.