Strategy
How SolNeutral generates yield with zero directional risk
Delta-neutral explained
The problem we solve
Most DeFi yield strategies are exposed to market direction. If SOL drops 30%, your vault drops with it. SolNeutral eliminates that risk entirely.
How delta-neutrality works
We hold equal and opposite positions: a long spot SOL position and a short SOL-PERP position on Drift Protocol. When SOL price moves, gains on one side cancel losses on the other — net delta is always ~0.
Where the yield comes from
Perpetual futures have a funding rate — a fee paid from longs to shorts (or vice versa) every hour to keep the perp price anchored to spot. On Drift, this rate is positive 92%+ of the time, meaning our short position earns fees continuously.
Step 1 — Split capital
50% of vault USDC goes to spot SOL (long). 50% used as collateral for SOL-PERP short on Drift.
Step 2 — Collect funding
Every hour Drift settles funding payments. Our short position receives payments when rate > 0.
Step 3 — Rebalance
Every 8 hours (or when delta drifts >2%), we adjust positions to restore delta-neutrality.
Step 4 — Compound
Collected funding fees are added back to the vault, increasing the base for next period.
On-chain verification
All vault transactions are recorded on-chain and verifiable on Solscan. Smart contract code is open source on GitHub.