Where to park stablecoins on Solana

I believe we are moving into the next leg of the current bull market, which is causing me to think more seriously about when to rotate out of $SOL and other volatile crypto assets into stablecoins like USDC or USDT. But where should you park these stable assets so that you still earn safe, competitive yield so that your funds can continue to grow? That’s a question I recently posed on X, and was pleasantly surprised to receive a ton of helpful replies.

I thought it would be helpful to summarize the opportunities that were shared and layer in some of my own research so that others who are asking themselves the same question of “where to park stablecoins on Solana” can have a head start in their research.

Dislaimer: Before we dive in, an important disclaimer: none of this is financial advice. You should do your own research before exploring any of the opportunities below.

Coinbase One

• Site: https://www.coinbase.com/
• Summary: 5.5% fixed APY on up to $30,000 in USDC for Coinbase One subscribers
• Yield Source: Rewards are funded by Coinbase reserves.
• Risk: Very Low, since yield does not come from lending or DeFi where systemic risk or black swan events could cause loss of funds.
• My Opinion: This is a fine option if you are on the most conservative end of the risk curve but still want to be able to quickly deploy capital during a dip. But the yield is not good, especially considering you can earn over 5% APY in FDIC-insured accounts via Betterment or Wealthfront. That’s a better route if your goal is to earn 5% on USD.

Kamino Lend

• Site: https://app.kamino.finance/
• Summary: Currently 12.34% variable APY in USDC via their USDC lending pool; 10.72% APY in USDC via their JLP USDC lending pool; and 3.53% APY in their USDC-USDT liquidity pool on Orca. Positions also have 2x-3x points bonuses in the Kamino Season 2 points program.
• Yield Source: Fees paid by borrowers in their lending pools and fees paid by swapping in liquidity pool.
• Risk: Smart contract risk at Kamino and at underlying protocols that Kamino uses for liquidity pools (Orca, Raydium, Meteora). Kamino smart contracts have been audited 8 times. Kamino also has a very nice risk dashboard that enables real-time monitoring. Black swan events always pose a possible risk with lending protocols.
• My Opinion: Kamino is the #1 DeFi protocol on Solana and have very robust risk management systems and transparency around their products. I personally keep some USDC in the their JLP USDC lending pool.

Marginfi Lend

• Site: https://app.marginfi.com/
• Summary: Currently 14% variable APY in USDC via their USDC lending pool. Positions also accrue Marginfi points for a possible future airdrop of MRGN.
• Yield Source: Fees paid by borrowers.
• Risk: Smart contract risk at Marginfi. Marginfi smart contracts have been audited. Black swan events always pose a possible risk with lending protocols.
• My Opinion: Marginfi was once the top lending protocol on Solana, but has since been overtaken by Kamino. I prefer Kamino due to more audits, better community engagement, more transparency around products, and better user experience. But Marginfi is a perfectly fine alternative, especially if you think their eventual airdrop will be more lucrative than future Kamino drops.

Lulo

• Site: https://www.lulo.fi/?type=yield
• Summary: Currently up to 20% variable APY in USDC via their lending aggregator product that automatically routes your funds to the highest yield lending opportunity on Solana.
• Yield Source: Fees paid by borrowers.
• Risk: Smart contract risk at Lulo and at underlying protocols that Lulo includes in their aggregator (currently Drift, Kamino, Mango, Marginfi, Solend). Lulo smart contracts have been audited, and the five protocols included in the yield aggregator are open source and have also been audited.
• My Opinion: If you are comfortable with two layers of smart contract risk, this seems like a really nice option to maximize yield when lending USDC across established DeFi lenders. I also like that the product allows users to earn points in the various products that are used, which may add additional yield over time.

Elemental Defi

• Site: https://elemental.player2.world/
• Summary: Currently 25% fixed APY in their Loam Fund, an actively managed USDC fund; and 11% APY in their Geodium Fund, which provides targeted liquidity into the USDC-USDT pool on Raydium.
• Yield Source: The Loam Fund generates returns through unspecified “yield farming and arbitrage opportunities” on Solana DeFi. The Geodium Fund earns yield from fees in the USDC-USDT pool on Raydium.
• Risk: Smart contract risk with underlying Solana DeFi protocols used in the Loam Fund strategy. Human risk related to utilizing an actively managed fund (managed by P2 Moo). Funds can only be withdrawn at the end of a 5-day “Elemental Epoch”.
• My Opinion: These products appear to offer competitive returns, so if you are comfortable having your USDC actively managed by P2 Moo and having funds locked for up to 5 days before being able to withdraw, this looks like a solid option. I personally prefer products where I have more freedom to withdraw on-demand.

Drift Insurance Fund

• Site: https://app.drift.trade/earn/stake
• Summary: Currently 40% variable APY on USDC staked in their Insurance Fund, the liquidity backstop for the Drift protocol.
• Yield Source: Share of protocol revenue, accrued hourly proportionate to amount staked.
• Risk: Smart contract risk if Drift is exploited. Possible product design risk during a black swan event. Product is also intentionally designed such that Insurance Fund stake exists “as a safety net to resolve bankruptcies” that the protocol may not be able to resolve during periods of high volatility. The Insurance Fund has a 13 day unstaking period. Drift has been audited. Drift does a good job of outlining possible risks here.
• My Opinion: Drift is a widely respected product/team, but I don’t personally think the added risks and 13 day lock-up is the worth the additional APY. But this is a great option if you don’t mind taking on additional risk due to very high APY.

Jupiter JLP

• Site: https://jup.ag/perps-earn
• Summary: Currently 55% variable APY in JLP, Jupiter’s liquidity token for their perpetuals exchange pool that is comprised of 26% USDC, 9% USDT, 44% SOL, 10% BTC, and 11% ETH.
• Yield Source: 70% of fees from margin traders who must borrow from the liquidity pool to trade with leverage, plus liquidations. JLP price also can fluctuate depending on value of underlying assets and liquidations.
• Risk: Smart contract risk if Jupiter Perps Trading were exploited. Possible product design risk during a black swan event. Jupiter Perps has been audited twice.
• My Opinion: I personally have assets deployed in JLP. Jupiter may be the most competent team in crypto and the JLP asset has performed incredibly well over the last four months during bull and bear stretches (see chart below). Even when prices have dipped, JLP has been fairly stable due to fees and revenue from liquidations. However, since JLP is ~65% SOL/BTC/ETH, it’s less of a true stable asset than holding USDC.

Flash Trade Earn

• Site: https://beast.flash.trade/earn
• Summary: Currently 56.8% variable APY in FLP.1, Flash Trade’s liquidity token for their primary liquidity pool that is comprised of 45% USDC, 25% SOL, 20% BTC, and 10% ETH.
• Yield Source: Fees from margin traders who must borrow from the liquidity pool to trade with leverage, plus liquidations. FLP.1 price also can fluctuate depending on value of underlying assets and liquidations on Flash Trade.
• Risk: Smart contract risk if Flash Trade were exploited. Possible product design risk during a black swan event. Flash Trade has been audited and conducted black swan event simulations.
• My Opinion: I personally have assets deployed in FLP.1 and can confirm that the yield is not only significant, but like that it’s paid out daily. I also like that funds can be withdrawn at any time; no lock ups. But this is also higher up the risk curve and less of a true stable asset since 55% of the FLP.1 pool is exposure to BTC/ETH/SOL.

Divvy.Bet House Pool

• Site: https://app.divvy.bet/housepool/?house=1
• Summary: Currently 144% variable APY (based on last 30 days) in their House Pool.
• Yield Source: Fees and gambling losses from users of their decentralized sports book.
• Risk: Smart contract risk if Divvy were exploited. Possible product design risk if sports book odds are not properly set. Possible legal issues in jurisdictions that prohibit casinos/gambling. Smart contracts have been audited by Sec3 according to their website, but I can’t find the link.
• My Opinion: This seems further up the risk curve for a lot of reasons, but it’s a VC-funded project with a slick product and very high yield. Also appears to be a token to potentially position for as well.

That’s it for now. This will be an evolving list, so bookmark this post and check back in the future for updates, or leave a comment if I missed anything you think is a really strong option.