Historical Simulation
Daily resolution, Jul 2024 – Jun 2026 (24 months). Backtest re-cut 2026-08-05 for the fee hurdle; venue and lending rates measured the same day.
Backtest. Phoenix only launched in Dec 2025, so there isn't enough of its own funding history to test against. This runs on historical SOL-perp funding as a stand-in, using the two modes v1 actually has: normal basis and parked. Phoenix anchors its funding to CEX index feeds, so the stand-in uses Binance funding at face value (×1.0), which tracks the same prices Phoenix does. An earlier version calibrated against Drift ran hot and produced a ~9% figure. The honest CEX-anchored number is ~6% net.
Headline
Over 24 months that include the 2025–26 funding compression, the strategy's worst peak-to-trough fall was −0.3%, and $100 compounded to $112.37. It sat parked on a third of days, when funding wasn't paying enough to be worth it.
Max drawdown
−0.3%
Net APY (thin-funding regime, after fees)
~6%
Gross APY
~7%
Parked share of days
33%
Parked floor / USDC lending benchmark
~4%
Read the drawdown first, not the yield. The design's whole claim is that it kept compounding straight through a funding collapse and never gave back more than a fraction of a percent from a peak.
The yield depends on the regime. About 6% net is what this risk profile pays when funding is thin, as it is now, and it scales toward ~11% when funding is rich. Phoenix pays roughly nothing today, so the vault sits near its lending floor and adds funding on top whenever there's funding to collect.
These are backtest figures. The "~0%" you may see in the app's regime widget is a live funding snapshot, not a backtest APY.
What's already inside the number
The figure the backtest produces is the figure claimed. Nothing is adjusted on top of it afterwards.
Every cost sits inside the gross return: perp fees, slippage, mode-switch costs, and the margin haircut — the slice of NAV posted as USDC margin at Phoenix, which earns nothing rather than the basis. The only step from gross to net is the performance fee, charged above the high-water mark and above the lending-rate hurdle.
So ~6% is fully loaded, not a starting point to subtract from.
Where the yield comes from
Most of it is staking, not funding. Fully hedged, per $100 of NAV per year:
$90.9 of jitoSOL @ ~7% staking
+$6.36
$9.1 of USDC margin at Phoenix @ 0%
$0.00
Funding on the short — Binance proxy, +3.76%
+$3.42
Funding on the short — measured Phoenix
~$0.00
Perp fees + ~6 mode switches
−$0.30
The staking leg alone out-earns the whole product's net APY. Funding is the smaller half in the backtest, and close to nothing at Phoenix's actual rate — its median hourly funding over the last week was zero.
That's why the mode threshold is derived from the staking-versus-lending spread rather than from funding, and why the vault stays hedged even at slightly negative funding. The hedge takes price risk down to near zero; it is not the revenue.
It also means the Binance stand-in flatters the funding leg by a wide margin, so read that row as a ceiling rather than a forecast. And the yield risk that matters is staking-rate compression, not thin funding: thin funding parks the vault at the lending floor, whereas a lower Solana staking rate lowers the ceiling with nothing to park into.
The fee hurdle
The performance fee applies only to return above a hurdle set to the USDC lending rate. Strategy, gross return and drawdown are all unchanged by it; the fee schedule is the only thing that moved.
It exists because of the parked leg. A third of the days here are spent lending USDC on Kamino, which any holder could do themselves in one click. A flat performance fee took a fifth of that return, leaving a parked holder behind where they'd have been without the vault at all. The hurdle removes that, and it tracks the lending rate rather than sitting at a fixed number.
Over this window it lifts net APY from 5.2% to 6.0%, because the fees charged fall by close to 60%. Parked, you keep the lending rate. Hedged, the edge over lending it yourself is a bit under 200 bps.
Methodology
Window
Jul 2024 – Jun 2026 (24 months, recent track record)
Funding source
Daily Binance funding, taken at face value as a stand-in for Phoenix. Phoenix anchors its own funding to CEX index feeds (Binance, Coinbase, Hyperliquid, Bybit), so the stand-in references the same prices Phoenix does. No multiplier is applied
Mode classification
A 7-day rolling average with a ±3% band around the threshold to filter out flip-flopping. Normal basis when funding clears the threshold by that band, otherwise parked
Margin haircut
The short is deliberately over-margined, well inside the venue's limit, which leaves about 9% of NAV sitting as USDC margin earning nothing
Parked behavior
USDC at 4% lending APR
Costs
5 bps perp fee + 10 bps slippage per side; 20–40 bps mode-switch cost
Fees
0% management, 20% performance above the HWM and above the lending-rate hurdle
Reproduce:
--no-reverse is required. It restricts the run to the two modes v1 actually has, normal basis and parked. Without it the run also trades the dormant Reverse leg, which isn't in the program, and reports a materially different result. Data CSVs are committed under scripts/simulations/data/.
Frictions not in the model
Price impact when rebalancing the perp leg. The model uses a fixed slippage assumption. Real trades of real size depend on how much liquidity is there at the time, and under stress a month could run worse than the modeled −0.3%.
Proxy risk. Using Binance funding at face value assumes Phoenix tracks CEX index feeds closely. Phoenix's own book may still behave differently in practice.
Reserve-fund drag and the smoothing from hourly funding to daily figures. Neither is subtracted from the headline.
Related
Whitepaper — Performance section
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