Note: This article is not financial advice. Hubble Protocol does not endorse any tokens or platforms mentioned in this article.
This is the next article in Hubble's series on Crypto Basics that covers crypto lending. The first article on lending crypto introduced the basics of how crypto lending works. This post will focus on the best Solana protocols to lend crypto.
A Quick Note on Protocols and Numbers
Decentralized finance (DeFi) on Solana offers many lending opportunities. Most of the protocols mentioned in this article provide lending services to support other DeFi activities beyond plain vanilla debt, including leveraged yield farming (LYF) and margin trading.
Although Hubble Protocol has partnered with several of the projects mentioned here, this article is not an endorsement and is not financial advice. Therefore, this post will avoid mentioning explicitly specific details concerning things like rates, but some images may include information from when screenshots were taken.
The Solana protocols listed in this article are ordered by total value locked (TVL) at the time of writing, and of course, these figures change regularly.
Solend - $263M TVL
Solend is currently the biggest lending market on Solana. A wide range of assets can be borrowed or lent in the Solend crypto Main Pool and isolated money markets such as the USDH Pool or Coin98 Pool.
Users can mint cTokens to earn yield on their deposits while having a fungible Solend Solana asset that can be deposited as collateral on other DeFi protocols. Additionally, Solend is reportedly developing permissionless loan markets.
Tulip Finance - $125M TVL
Tulip Finance provides multiple DeFi services. One of these Tulip Solana integrated products is LYF, or leveraged yield farming, which relies on lending from the Tulip protocol and yield farming from other Solana protocols. Lending yield is essentially generated by users borrowing to leverage their yield farming positions.
Mango Markets - $114M TVL
Mango Markets may be better known for margin trading and its perpetual futures market, and it provides in-house lending and borrowing services. Deposited assets earn yield as they are continuously lent out to other Mango Solana users.
Francium - $62M TVL
Francium crypto lending supports LYF. The protocol streamlines the process of leveraging yield farming positions. Borrowers can access under-collateralized loans through Francium when participating in LYF, since Francium handles all aspects of borrowing and setting up LYF.
Credix Finance - $23M TVL
Credix is a lender that only works with institutional clients and focuses on real-world assets (RWAs). Therefore, only Credix Solana lenders who are accredited investors can deposit USDC to finance RWA lending.
01 Exchange - $18M TVL
01 Exchange is a derivatives DEX powered by Serum's order book. Users earn interest from their deposited assets, which other 01 Solana users can borrow for leverage.
Maple Finance - $14M TVL
As a multi-chain undercollateralized institutional lender, Maple Finance might be the biggest protocol on this list overall. However, the TVL of Maple Solana is nowhere near as extensive as its presence on Ethereum.
Port Finance - $10M TVL
Port Finance offers money markets that include isolated pools such as the Hubble Innovation Zone. In addition, Port is one of the few DeFi protocols that have attempted fixed-rate lending.
Apricot Finance - $8M TVL
Apricot focuses on providing LYF services, but it does not require users to lend their assets before setting up a leveraged position. Lending assets to other Apricot Solana users participating in LYF can offset the costs of taking on leverage.
Jet Protocol - $5M TVL
Jet Protocol is a money market that limits its pool to blue-chip crypto assets. The tokens that can be borrowed and lent on Jet Protocol include SOL, BTC, USDC, USDT, and mSOL.
Everlend Finance - $150k TVL
Everlend Finance is one of the newest protocols on this list, and it integrates the services of many of the protocols already mentioned. Everlend bills itself as a lending aggregator and optimizer that pursues the highest lending yields on behalf of its users.
Xenon Protocol - $86k TVL
Xenon Protocol is described as Solana's first "Universal Margin Protocol." Lenders can deposit USDC for xeUSDC, which can earn yield as others borrow the value of xeUSDC for margin across multiple Solana DeFi protocols.
Solana Lending Protocol Tips
Lending crypto on Solana can be a passive way to increase users' token holdings for assets they want to HODL for a long time. However, this doesn't mean that users should remain passive about doing their due diligence or checking and managing positions.
One thing to remember is that DeFi lending does not occur in a vacuum, and other users' borrowing habits affect APY as well as withdrawals. Note that when participating in peer-to-peer lending, high utilization rates can make it impossible for users to withdraw their tokens, since other users are borrowing them.
There are many opportunities for lending crypto on Solana, and the ecosystem is growing beyond what has been listed here. It will be exciting to see how the future of this Solana DeFi sector compares with the playing field in 2022!
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