Announcing cVaults

Zeta Markets
2 min readApr 4, 2022

Solend, Katana & Zeta are excited to be partnering together to bring composed yields to DeFi users on Solana. Users are now able to deposit cTokens from Solend into Katana cVaults, powered by Zeta, to earn additional yield! cTokens are incredibly composable and we’re excited to be bringing one of their use cases to life through cVaults.

cSOL Covered Call Vault on Katana

What are cTokens?

cTokens are a yield-bearing deposit receipt. You can convert USDC into a cToken on Solend, cUSDC. This cUSDC is a tradable token that earns interest through Solend! You can then either hold this token in your wallet or use it across DeFi protocols and it’ll keep on earning interest.

Minting cTokens on Solend Protocol

What are cVaults?

cVaults leverage Solend’s cTokens to generate additional yield for users. Once you’ve minted a cToken on Solend, you can deposit this into a cVault on Katana — you are now earning the interest from the cToken + the yield from the vault.

We’re going live with the cSOL covered call vault, with more on the way!

How to use cVaults?

To take advantage of cVaults and generate additional yield, we’ve made it super simple:

  1. Mint cTokens on Solend at https://solend.fi/ctokens
  2. Head to Katana and deposit your cToken into a cVault powered by Zeta: https://app.katana.so/options/call/csol
  3. Earn more yield!

What are the risks?

  • Smart contracts risk.
  • The vault may incur a loss if the price of cSOL is above the strike price of the call options at the time of expiry. If so, the options are deemed to have expired in the money and can be exercised for the cSOL locked by the vault, resulting in a potential loss in cSOL terms for the period. Strike prices are chosen such that these events are exceedingly rare.

Conclusion

cVaults are a great representative of the composability that DeFi allows — three projects coming together to bring a unique product to market. We’re excited to see continued innovation in the space through composability.

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Zeta Markets

Zeta Markets is the premier under-collateralized DeFi derivatives exchange, providing liquid derivatives trading to individuals and institutions alike.