> For the complete documentation index, see [llms.txt](https://docs.keystonefi.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.keystonefi.xyz/keystone-finance/reserve-asset.md).

# What is ksUSD?

**ksUSD turns SOL staking into dollar yield.** Hold it and its price rises as the vault earns.

**It is a vault share, not a pegged dollar.** ksUSD defends no peg and is not redeemable for a fixed $1. Deposits mint at the current share price and redemptions burn at it, so a share is worth whatever the vault's assets are worth. The price is meant to rise as yield accrues — and it can fall. A bad unwind or a jitoSOL depeg lands in the share price rather than being absorbed somewhere else.

Solana staking pays well, but it pays in SOL — which is no use if you account in dollars. The vault holds staked SOL and hedges the price risk away, so what you keep is the yield without the asset. That hedge is the whole mechanism, and when perp funding is positive it pays you rather than costing you.

Under the hood it's deliberately small: one Anchor program, one vault account the program itself controls, and one token.

Most of the return is jitoSOL staking (about 7% APR). Phoenix SOL-PERP funding adds to it when the market pays, and USDC lending on Kamino (about 4–5% APR) is the floor when hedging isn't worth it. Full breakdown in the [Introduction](/readme.md#how-it-earns).

## Strategy in brief

There is one strategy, and it runs in one of two modes at a time.

**Normal basis.** The vault holds jitoSOL to earn staking yield, and shorts the same amount of SOL on Phoenix using USDC as margin. The long and the short cancel out, so SOL's price barely affects your return. This mode runs when funding clears the vault's threshold. The break-even sits at −2.6% — staking already out-earns lending, so the short can cost a little and still leave you ahead — and the launch configuration deploys that break-even as the on-chain floor. The jitoSOL is held "unlevered", meaning it's owned outright with nothing borrowed against it.

**Parked.** When funding is thin or negative, the vault closes the short, sells the jitoSOL back to USDC, and lends everything on Kamino.

Parked always means USDC lending. It never holds tokenized T-bills.

[Strategy & Modes](/how-it-works/strategy-and-modes.md) has the full mechanics, the funding threshold, and the guardrails around switching.

***

## Related

* [Whitepaper](/reference/whitepaper.md) — full design, NAV math, security, risk disclosures
* [Deposit](/keystone-finance/deposit.md) · [Withdraw](/keystone-finance/withdraw.md) · [Check position & NAV](/keystone-finance/check-position.md)
* [Risk management](/how-it-works/volatility-risk-management.md) — drawdown guard, slippage bounds, dwell timers, depeg and staleness guards
* [Fee structure](/reference/fees.md) — 0% management, 20% performance above the high-water mark, 5% reserve skim