Watt Protocol

Watt Protocol was a Solana-based DeFi protocol that applied liquid staking mechanics to any SPL token, generating yield through market arbitrage rather than emissions or inflation. The protocol shut down in June 2026, with Power Labs Inc. directing users to unwrap all tokens and exit Raydium liquidity pools by June 23, 2026.

Watt Protocol described itself as the first universal staking account on Solana that generates real yield for users by capitalizing on natural market arbitrage opportunities. Where conventional Solana liquid staking protocols such as mSOL or jitoSOL applied only to native SOL, Watt extended the same concept to any arbitrary SPL token. A holder of BONK could wrap their tokens to receive wattBONK, a yield-bearing token backed 1:1 by the underlying at time of deposit and redeemable at any time without a lockup period. The protocol was built by Power Labs Inc. and founded by Vlad Picha. It placed fifth in the DeFi track at the Colosseum Solana Radar Hackathon and was accepted into the Colosseum accelerator program.

The core yield mechanism was what Watt called volatility farming. The protocol used Solana's Token-2022 standard, which allows a transfer fee to be baked into the token's on-chain definition. When a user wrapped a token, a corresponding watt token was minted, the underlying was held in a vault, and two Raydium CPMM liquidity pools were created: one for the original token and one for the watt token. Price discrepancies between the pools would arise as trading occurred. Arbitrageurs exploited these gaps by buying and unwrapping underpriced watt tokens, or by wrapping the underlying and selling overpriced watt tokens. Each arbitrage trade triggered the Token-2022 transfer fee, and those fees accrued as yield to watt token holders and liquidity providers. Yield came from market volatility itself rather than from token inflation or lending.

Yield was tracked through a token ratio: vault-held underlying divided by total watt token supply. A portion of every collected fee was used to burn watt tokens, reducing supply and raising the ratio. Users who unwrapped received more underlying than they deposited, with the delta representing accumulated yield.

Fee parameters were set by the initial liquidity provider, called an Amplifier, at launch and could not be changed afterward. Wrap fees ranged from 0 to 10 percent, unwrap fees from 0.4 to 10 percent, burn rate from 10 to 50 percent of collected fees, and buy/sell fees from 0.55 to 4 percent. The combined wrap and unwrap fee had to exceed 0.8 percent. Higher-volatility tokens such as meme coins warranted higher fees; utility tokens warranted lower fees. Amplifiers received 100 percent of their fee allocation while their LP position remained active. Access to become an Amplifier was invitation-only.

Watt Protocol completed two security reviews before shutting down. Ackee Blockchain Security conducted a full-scope audit in June 2025, with all findings resolved, partially addressed, or acknowledged. Sec3 performed an automated static analysis scan in May 2025 using its X-Ray tool, covering more than 50 categories of known vulnerabilities; an amended report was published after the review. The protocol's documentation identified seven risk categories: smart contract exploits, Raydium dependency, low-volatility APR compression, liquidity slippage, immutable fee parameters, Solana network outages, and Token-2022 compatibility issues with legacy wallets.

A WATT governance token was issued with a total supply of one billion. By mid-2026 it had negligible market activity, near-zero market capitalization, and was unverified on major wallet interfaces. It did not appear in TVL tracking on DeFiLlama or comparable aggregators.

The watt.si homepage as of July 2026 carries a notice from Power Labs Inc. stating the protocol is winding down, with the June 23, 2026 exit deadline now passed. The @wattprotocol X account posted no updates following the shutdown announcement. The protocol's website and documentation remain accessible, but the active product is no longer operational.

Watt Protocol's approach was technically novel: it extended liquid staking mechanics to arbitrary SPL tokens using Token-2022 transfer fees, a capability unique to Solana's token standard. Its reliance on Raydium CPMM as sole DEX infrastructure concentrated counterparty risk in a single external protocol. Despite completing two audits and participating in the Colosseum accelerator, the project did not achieve sufficient adoption before shutting down less than two years after its June 2024 founding.