Hubble Launches Isolated Solend cToken Borrowing Vault

Hubble is introducing its first Isolated Vault, enabling Solend's yield-bearing cTokens to be deposited as collateral for USDH

Hubble is excited to announce the addition of Solend’s cTokens as collateral for minting USDH. cTokens are yield-bearing tokens that earn interest from lending activities on Solend. Now, they enable users to earn yield while borrowing USDH.

Accepting cTokens as collateral solidifies the partnership between Hubble and Solend. Together, we’re creating new possibilities for users to maximize their yield potential while participating in DeFi on Solana.

Introducing a new, isolated borrowing experience

The cToken Vault ushers in a new Vault-based borrowing system, which will enable Hubble to set up independent borrowing environments with distinct parameters. Ultimately this is aimed at creating a more tailored borrowing experience.

Parameters

The initial parameters of the cToken Vault are as follows:

  • LTV: 80%
  • Stability Fee: 1%
  • Deposit Caps: $1M per token
  • Withdrawal Caps: $1M per token every 8 hours

These parameters are, of course, fully adjustable, and we will evaluate them in cooperation with our community to ensure that the borrowing environment remains optimal.

Assets

The cToken Vault will contain a variety of different cTokens, enabling users to deposit any combination of the following assets:

  • cSOL
  • cmSOL
  • cstSOL
  • cETH
  • cBTC
  • cRAY

While deposited, the value of these tokens grows over time. By depositing cTokens, you can theoretically increase your available collateral, without depositing additional tokens.

Maximize Yield on SOL with Liquid Staking and Lending

Solana allows for extreme composability in DeFi due to its high throughput and low fees. Transacting on a secure Layer 1 makes it possible for users to put together a lot of “money Legos” to maximize yield generated on SOL, for example.

For instance, you can stake SOL with a network validator to help secure the network. This earns a predictable yield, but it locks up your tokens for a period of around two days and makes it impossible to do anything else with your SOL while it's staked.

Another option is depositing your SOL with Marinade or Lido to receive mSOL or stSOL, respectively. These "liquid staked" tokens enable you to participate in DeFi while at the same time earn staking rewards.

Once you turn your SOL into mSOL or stSOL, you can deposit these tokens on Solend to generate even more yield. When you mint cmSOL or cstSOL, you receive a token that earns dual forms of yield: staking yield and lending yield.

Now, you can use this cmSOL and cstSOL to mint USDH, while earning yield all the while!

How you can maximize Earning Potential with cTokens and USDH

Let’s recap our thought experiment and see where our journey through DeFi composability has brought us:

  • Started off with USDC
  • Swapped USDC for SOL
  • Staked SOL for mSOL or stSOL (liquid staking tokens)
  • Deposited liquid staking tokens for lending on Solend
  • Received cTokens as a receipt

Now, the original long position in SOL is earning two forms of interest from some of the most trusted protocols in the Solana ecosystem, and we’ve yet to get to Hubble!

By depositing cTokens on Hubble, you can then borrow the stablecoin USDH at up to 80% loan-to-value (LTV) against your collateral. We started off with stablecoins, we set up two yield-bearing positions with an asset we want to HODL, and now we have stablecoins at our disposal again!

From this point, you can do anything you want with the amount of USDH you feel comfortable borrowing against your collateral. True composability: Hubble’s USDH and Solend’s cTokens working together for an even greater variety of capital-efficient yield strategies!

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