Glossary

Terminology and Definitions

Solenes: A decentralized finance protocol on the Solana blockchain offering stable synthetic dollar assets (USDs) and a yield-generating savings instrument (sUSDs).
USDs: Solenes’s synthetic, dollar-pegged asset, backed by crypto collateral and maintained through delta-neutral hedging.
sUSDs: A staked version of USDs that accrues yield over time, functioning as a savings instrument within the protocol.
SNE: The governance and utility token of Solenes, used for voting on protocol decisions and receiving staking rewards.
Delta-Neutral: A hedging strategy where gains and losses in collateral value are offset to maintain price stability for USDs.
Hedging: A financial strategy used to reduce risk by taking offsetting positions, such as holding a short position to counterbalance a long collateral position.
Collateral: Assets deposited by users to mint USDs, which provide the backing for the synthetic dollar’s value.
Funding Rate: A fee paid between traders in a perpetual contract, designed to keep the contract price in line with the spot price of the underlying asset.
Basis Spread: The difference between the spot price of an asset and its futures price; can be used for generating returns through basis trades.
Liquidity Pool (LP): A pool of tokens provided by users to facilitate trading and earn fees; initial liquidity for SNE is provided through LPs.
Staking: Locking tokens (such as SNE or USDs) to earn rewards, typically representing a long-term commitment to the protocol.
Governance: The process by which SNE holders participate in decision-making, including voting on proposals and protocol updates.
APY (Annual Percentage Yield): The annual return rate, factoring in compounding interest; used to indicate the yield on staked assets like sUSDs.
Custodial Risk: The risk of assets held by a third party becoming inaccessible or being affected by regulations or other risks.
On-Chain: Activities, transactions, or data stored and validated on the blockchain, ensuring transparency and security.
Off-Exchange Settlement (OES): A mechanism for holding assets in custody without fully relying on centralized exchanges, reducing certain types of counterparty risk.
Convexity: In the context of inverse contracts, convexity refers to the non-linear payout structure that changes with the price of the underlying asset.
Real World Assets (RWAs): Physical assets, such as U.S. Treasury bonds, used as collateral in some centralized stablecoins, with implications for censorship and regulatory risk.
Perpetual Contracts: A type of derivative contract with no expiration date, allowing traders to maintain positions indefinitely with funding payments to align with the spot price.
Smart Contract: Self-executing code on the blockchain, governing protocol functions like staking, minting, and redeeming, without the need for intermediaries.

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Last updated 7 months ago

Terminology and Definitions

Solenes: A decentralized finance protocol on the Solana blockchain offering stable synthetic dollar assets (USDs) and a yield-generating savings instrument (sUSDs).

USDs: Solenes’s synthetic, dollar-pegged asset, backed by crypto collateral and maintained through delta-neutral hedging.

sUSDs: A staked version of USDs that accrues yield over time, functioning as a savings instrument within the protocol.

SNE: The governance and utility token of Solenes, used for voting on protocol decisions and receiving staking rewards.

Delta-Neutral: A hedging strategy where gains and losses in collateral value are offset to maintain price stability for USDs.

Hedging: A financial strategy used to reduce risk by taking offsetting positions, such as holding a short position to counterbalance a long collateral position.

Collateral: Assets deposited by users to mint USDs, which provide the backing for the synthetic dollar’s value.

Funding Rate: A fee paid between traders in a perpetual contract, designed to keep the contract price in line with the spot price of the underlying asset.

Basis Spread: The difference between the spot price of an asset and its futures price; can be used for generating returns through basis trades.

Liquidity Pool (LP): A pool of tokens provided by users to facilitate trading and earn fees; initial liquidity for SNE is provided through LPs.

Staking: Locking tokens (such as SNE or USDs) to earn rewards, typically representing a long-term commitment to the protocol.

Governance: The process by which SNE holders participate in decision-making, including voting on proposals and protocol updates.

APY (Annual Percentage Yield): The annual return rate, factoring in compounding interest; used to indicate the yield on staked assets like sUSDs.

Custodial Risk: The risk of assets held by a third party becoming inaccessible or being affected by regulations or other risks.

On-Chain: Activities, transactions, or data stored and validated on the blockchain, ensuring transparency and security.

Off-Exchange Settlement (OES): A mechanism for holding assets in custody without fully relying on centralized exchanges, reducing certain types of counterparty risk.

Convexity: In the context of inverse contracts, convexity refers to the non-linear payout structure that changes with the price of the underlying asset.

Real World Assets (RWAs): Physical assets, such as U.S. Treasury bonds, used as collateral in some centralized stablecoins, with implications for censorship and regulatory risk.

Perpetual Contracts: A type of derivative contract with no expiration date, allowing traders to maintain positions indefinitely with funding payments to align with the spot price.

Smart Contract: Self-executing code on the blockchain, governing protocol functions like staking, minting, and redeeming, without the need for intermediaries.