Keystone Alpha Fund
Directional SOL exposure — bull markets
Directional SOL fund. Allocates between jitoSOL and USDC based on SOL's distance from its all-time high — accumulates during drawdowns, reduces near peaks. Idle USDC earns lending yield via Marginfi.
No derivatives or hedging. SOL exposure is taken entirely through jitoSOL, a liquid staking token that earns native staking rewards and MEV tips (~5.8% APY).
Allocation Mechanics
The fund derives a target jitoSOL allocation from SOL's current price relative to its all-time high (ATH):
≤ 25% of ATH (deep drawdown)
80%
~50% of ATH
~50%
≥ 80% of ATH (near peak)
20%
Allocation is interpolated linearly between the 25% and 80% thresholds. Hard bounds of 20–80% are enforced at all times.
The remaining allocation sits in USDC, which earns yield via Marginfi lending.
Example (ATH = $260):
$65 (25% of ATH)
80%
$136 (52% of ATH)
~50%
$208 (80% of ATH)
20%
When SOL sets a new ATH, the reference price updates automatically during the next rebalance.
Yield Sources
jitoSOL staking
~5.8%
SOL staking rewards + MEV tips via Jito
Marginfi USDC lending
~3–5%
Idle USDC lent to borrowers on-chain
Blended (estimated)
4–5.5%
Weighted by allocation at any given time
Yield estimates are not guaranteed. Actual returns depend on market conditions, staking reward rates, and lending utilization.
Automated Cycle
The fund runs a single permissionless instruction on a 7-day cadence. Any keeper can call it; the protocol enforces the interval.
The fund never moves to its target in a single step. Allocation changes are bounded by the active step size, which varies by regime. A 60% target with a 3% step takes roughly 7 rebalances (~7 weeks) to reach from 40%.
Market Regimes
The fund classifies conditions into four regimes and adjusts its behavior accordingly:
Normal
Drawdown < 35%, volatility 1–4%
3.0%
20–80%
Low Vol Near Peak
Drawdown < 35%, volatility < 1%
4.5%
20–56%
High Vol Drawdown
Drawdown 35–55%, volatility > 4%
1.5%
20–80%
Bear Market
Drawdown > 55%
0.75%
30–40%
Normal — Standard operation.
Low Vol Near Peak — Larger steps, but maximum exposure capped at 56% to limit concentration near price peaks.
High Vol Drawdown — Smaller steps during volatile corrections to reduce the risk of increasing exposure into a declining market.
Bear Market — Minimal movement and a compressed allocation range to preserve capital.
Detailed regime and circuit breaker mechanics →
Circuit Breakers
An additional protection layer activates when drawdown exceeds 40% and volatility exceeds 6%:
6–10%
Reduce step size to 30% of normal
> 10%
Suspend rebalancing entirely
Circuit breakers reset automatically when conditions normalize.
Deposits
Deposits into the Alpha fund arrive as USDC via Keystone Core. On deployment the fund swaps USDC → jitoSOL via Jupiter.
USDC
Deployed to jitoSOL (via Jupiter) or held in Marginfi lending
Direct deposits to this fund are not supported. All deposits route through Keystone Core, which handles any LST or SOL conversion to USDC before routing here.
Parameters
Allocation
ATH price
Auto-tracked
Updated when SOL sets new highs
Low threshold
25% of ATH
Below this → maximum SOL allocation
High threshold
80% of ATH
Above this → minimum SOL allocation
SOL allocation range
20–80%
Hard bounds enforced at all times
Max step
3%
Base allocation change per rebalance interval
Rebalance interval
7 days
Minimum time between rebalances
Volatility and Regime
Vol low / high thresholds
1% / 4%
Boundaries for regime classification
Drawdown moderate / severe
35% / 55%
Drawdown thresholds for regime transitions
Regime step multipliers
25–150%
Step size scaling factor per regime
Circuit breaker arm
40% drawdown + 6% vol
Conditions that activate the circuit breaker
Circuit breaker skip
10% vol
Volatility level at which rebalancing is suspended
All parameters are adjustable by the fund admin via update_fund_params.
Fees: 0.5% management + 20% performance (above high-water mark) + 0.1% per rebalance. Details →
Last updated