Vectis Finance

Vectis Finance is a Solana-based DeFi yield protocol that gives USDC holders access to institutional-grade delta-neutral strategies — capturing the trading fees and funding rate income embedded in Jupiter's liquidity pools while stripping out directional price risk entirely.

The Problem It Solves

Holding stablecoins in DeFi has historically meant accepting either low single-digit lending yields or taking on unhedged exposure to volatile assets in exchange for higher returns. Vectis was built to close that gap. By combining leveraged JLP positions with automated short hedges on perpetual markets, the protocol delivers equity-scale APRs to depositors who never want to bet on the price direction of SOL, ETH, or BTC.

Core Mechanism

The foundation of every Vectis strategy is the Jupiter Liquidity Provider (JLP) token. JLP is a basket asset that backs the Jupiter Perpetual exchange on Solana; holders earn a share of all trading fees, liquidation proceeds, and borrow fees generated by the perp market. Historically this has produced annualized returns above 20%, but those returns come bundled with significant directional exposure to the underlying assets — SOL, ETH, BTC, USDT, and USDC — that compose the basket.

Vectis decouples yield from price risk through a three-step process:

1. Acquire and leverage JLP. USDC deposits are used to mint JLP, then the protocol borrows additional USDC through JLP Loans (a Drift Protocol primitive) and reinvests the proceeds back into JLP. This recursive leveraging strategy amplifies the base JLP yield by a factor of two to three without proportionally increasing depositor capital at risk.

2. Open delta-neutral short hedges. To offset the price exposure introduced by JLP and the leverage, the vault opens short positions on SOL, ETH, and BTC on Hyperliquid (the current flagship integration). Hedge ratios mirror the exact weightings of each asset inside JLP and are continuously monitored and rebalanced by an automated keeper system. When JLP prices rise, short losses are offset by gains in the underlying; when prices fall, short profits offset JLP losses. The net result is near-zero directional exposure.

3. Capture funding rates as a second income stream. Holding perpetual short positions on Hyperliquid generates funding rate payments whenever funding is positive — a market structure condition that has historically been common on major crypto perps. This creates a second, non-correlated revenue stream layered on top of JLP trading fees.

Vault Products

JLP HyperLoop Vault (current flagship): The evolved version of Vectis's original delta-neutral strategy, launched in August 2025. It accepts USDC deposits and executes the leveraged JLP loop with hedging routed through Hyperliquid rather than Drift. The switch to Hyperliquid was made to access lower-cost financing, deeper liquidity, and more efficient execution. The vault runs a 3-day redemption window and charges a 2% annual management fee, 25% performance fee, and 0.3% withdrawal fee.

JLP Navigator Vault (deprecated, succeeded by HyperLoop): The original delta-neutral JLP product, launched in November 2024 on Drift Protocol. Navigator ran three sub-vaults (A, B, C) capped at $3 million each — a constraint imposed by Drift margin requirements. In its early months it produced a 10.72% return from launch through early 2025, corresponding to an annualized 113–133% APR, with a maximum drawdown of 2.9% and a Sharpe ratio of 9.73 — significantly above JLP's standalone 3.36 or SOL's 1.22. At peak it attracted roughly $30 million in TVL. The vault charged a 20% performance fee only when profitable, with no deposit, withdrawal, or management fees.

JLP Navigator II Vault (deprecated): An intermediate version of the Navigator strategy, also since superseded by HyperLoop.

dSOL Anchor Vault: Targets liquid staking returns using dSOL (Drift's liquid staking token), combining dynamic leverage and hedging mechanics to optimize yield from the LST. Operates on audited partner protocols with no custom smart contract development by Vectis.

LST Compass Vault: A diversified liquid staking token basket vault using dSOL, INF, and jitoSOL. Charges a 25% performance fee on profits, with no management or transaction fees. Designed to reduce single-LST concentration risk.

Multi Lend: A yield optimization layer that routes stablecoin deposits across multiple lending protocols and assets, seeking the highest available interest rate at any given time.

Funding Rate Arbitrage: A dedicated strategy that exploits yield differentials between centralized and decentralized perpetual exchanges, earning from the spread between CEX and DEX funding rates.

Allora AI Edge: An integrated module that incorporates Allora Network's decentralized AI price forecasting to inform position management within Vectis vaults.

Vectis Prime: An institutional tier for deposits exceeding $500,000, offering enhanced yields, personalized support, and access to exclusive strategy allocations.

Supported Assets

Vectis vaults accept USDC as the primary deposit currency. Internally, vaults interact with JLP, dSOL, INF, jitoSOL, and the native assets of the Solana perpetuals ecosystem (SOL, ETH, BTC exposure managed through hedge positions on Hyperliquid and Drift).

Security and Custody

Vectis takes a deliberate approach to smart contract risk: rather than deploying proprietary vault contracts, the protocol's core vaults are built directly on top of Drift Protocol's audited vault framework. This means depositor funds are managed through Drift's well-audited smart contract infrastructure rather than novel Vectis code.

For custody, Vectis partners with Cobo, an institutional-grade digital asset custodian, for private key management and operational controls. The protocol positions Cobo's role as reducing human error and counterparty risk in fund operations.

The JLP Navigator Vault also featured an Insurance Fund: if vault losses exceeded 5% of assets, the Insurance Fund would be drawn on to cover the deficit — a protection layer for depositors not typically found in simpler DeFi vaults.

Circuit breakers, automated rebalancing systems, and fallback protections are described as part of the broader operational stack. No specific third-party security audit report is publicly cited by name.

Ecosystem Position

Vectis is part of a growing set of Solana protocols building structured yield products on top of Jupiter's perpetual exchange infrastructure. The JLP yield layer — which Vectis, Kamino, and others have all built around — has become one of the most productive and composable yield primitives on Solana. Vectis distinguishes itself by the sophistication of its delta-neutral execution: routing hedges to Hyperliquid rather than keeping everything on-chain adds complexity but offers access to deeper liquidity and lower funding costs than Solana-native perps alone can provide.

Partners listed by the project include Jupiter Exchange, Drift Protocol, Backpack, Voltr, Allora Network, Hyperliquid, and Cobo.

The team behind Vectis has not been publicly disclosed. The protocol was founded in 2024 and has operated without a formal token launch, positioning itself as a yield-first product rather than a governance or incentive token play.