Leverage JLP
What is JLP
The Jupiter Liquidity Provide (JLP) Pool is a liquidity pool where it acts as a counterparty to Jupiter perpetual traders. The JLP token represent a basket of assets, where its value is derived from an index fund of SOL, ETH, WBTC, USDC, USDT, Trader’s PnL, and 75% generated fees. For more information, visit Jupiter’s page here.
Leverage JLP with USDC Borrowings
Vaultka Junior’s expansion will also cover JLP token, starting with JLP from Jupiter. Users will be using USDC as collaterals to borrow more USDC and swap in more JLP. This low risk leverage play will allow users to leverage up to 10x on their holdings, and get amplified JLP revenue rewards.
Learn more about why Leverage JLP is a better option than hodling other assets here.
Mechanism
Users first deposit USDC to open position in Vaultka’s JLP Vault
Vaultka will then match user’s deposit asset and its requested leverage size to borrow from Vaultka’s lending pool
The total assets will be then used to swap as JLP through Jupiter Swap
A maturity date will be assigned to the position for 70days. Positions not closed in 70 days will be forced to close
Lending Pools - USDC
Vaultka’s lending pools offer and maintain higher-than-market yields for lenders, leveraging its unique reward split mechanism to balance the interests of both borrowers and lenders. For the first $5 million of USDC deposits, lenders get a guaranteed 25% APR on their deposits, ensuring lenders profitabliity.
Lenders enjoy a liquidation-free, high-yield, hourly auto-compounding structure, retaining exposure to the price movements of underlying assets and capturing capital gains alongside yield benefits. For more details on Vaultka’s lending mechanism, visit the Lending page.
Also learn more about how is the guaranteed 25% APR sustainable and achievable with our Substack here.
Reward Split Mechanism v.s. Interest Rate
Vaultka’s reward split mechanism creates a more favorable environment for LP yield farmers and lenders. Unlike traditional lending protocols that charge high interest rates, often around 30% , borrowers are required to pay interest on their loans hourly, regardless of whether their trades are profitable or not. This constant interest payment can significantly erode the value of the borrower's collateral and increase the risk of liquidation, especially under leveraged conditions.
Vaultka’s reward split mechanism allows borrowers to split a portion of their reward only when they are profitable, rather than being burdened by fixed, high-interest rates. By aligning the platform's incentives with the borrowers' success, Vaultka creates a more cost-effective and fair environment for users to leverage their positions. Find more details in the Fundamentals section.
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