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Kamino and lending protocols

Lending on Solana: deposit one token, borrow another

Kamino is one of the lending protocols with the most locked value on Solana, alongside Jupiter Lend, Drift, marginfi and others. Lending is the foundation of DeFi, and the place most likely to break when the market crashes.

Kamino ↗marginfi ↗← Back to key players

How lending works

You hold SOL and want stablecoins for something else, but you do not want to sell your SOL. A lending protocol lets you deposit SOL as collateral and borrow some stablecoins against it. The money you borrow is supplied by other people who want to earn interest.

The key is the collateral ratio: deposit $100 of SOL and you can usually borrow only $60–70. If SOL falls far enough, the protocol automatically sells your collateral to repay the debt. This is called liquidation.

Lending protocols on Solana hold about $2.70B in total, the second-largest category after liquid staking.

Locked value of the main lending protocols
  1. Kamino (all products)$1.40B
  2. Jupiter Lend$1.10B
  3. Drift (all products)$297.3M
  4. marginfi$44.1M

Data as of 16 Oct 2026, 01:45 UK time · source DefiLlama

Kamino locked valueWeekly · DefiLlama
$1B$2B$3B2023202420252026

Locked value is in US dollars and moves with collateral prices.

The main protocols

  • Kamino: started in 2022 with automated market-making vaults, launched lending in 2023, and later folded leverage and yield strategies into one product; it now leads Solana lending by locked value. KMNO was issued in 2024.
  • Jupiter Lend: Jupiter’s lending product, launched in 2025, growing fast on the back of Jupiter’s user base.
  • Drift: started with perpetuals and also offers lending and liquid staking.
  • marginfi: once one of the leading lending protocols; its locked value has shrunk sharply.

A lesson from history: Solend

In June 2022 a whale on Solend had deposited a huge amount of SOL; if SOL kept falling, liquidating that position would have crashed straight through on-chain liquidity. The Solend community voted through a proposal letting the protocol temporarily take over the account so it could be liquidated slowly off-market.

The proposal caused uproar: can a “decentralised” protocol vote to take over a user’s account? It was quickly withdrawn, but it showed how few options lending protocols really have in extreme markets.

Controversies and risks

  • Liquidation cascades: in a crash many liquidations happen at once, and the selling pushes prices down further.
  • Oracles: lending protocols rely on oracle prices to decide when to liquidate; wrong or manipulated prices create bad debt (Mango Markets in 2022 is an example).
  • Rates and liquidity: if depositors want to withdraw while most of the funds are lent out, they may have to wait.

What to watch

  1. Locked value in lending and the size of stablecoin borrowing.
  2. Liquidation volume during crashes, and whether any protocol ends up with bad debt.

Sources

  • Each protocol’s website and docs; locked value from DefiLlama. This page is an educational summary and is not investment advice.