Keystone × Jito: New jitoSOL Demand from Dollars That Can’t Hold It
Type: Ecosystem alignment & technical collaboration
Submitted by: Keystone Finance
Treasury request: None
TL;DR: Keystone issues ksUSD, a productive, bidirectional-carry dollar. jitoSOL is the staking leg of the strategy, the sole collateral at launch, and the asset ksUSD holds in its primary operating mode. We are not requesting treasury capital. We’re seeking technical feedback, risk review, and ecosystem alignment.
What is ksUSD?
ksUSD is a productive, bidirectional-carry dollar that earns from funding, lending, and staking.
Users deposit USDC and mint ksUSD 1:1. The protocol captures carry generated across Solana’s capital markets and distributes it through a rising share price.
Yield comes from three sources:
- Funding on Drift perpetuals
- Staking through jitoSOL
- Lending through Kamino
These positions are combined into a single delta-neutral strategy designed to earn yield without taking directional SOL price exposure.
Unlike stablecoins that depend on emissions or off-chain Treasury bills, ksUSD earns from on-chain market activity.
Think of it as Solana’s answer to Ethena’s USDe — but fully on-chain, with staking integrated directly into the yield engine.¹
Why jitoSOL Matters
jitoSOL is not simply one component of the strategy.
It is the asset that makes the strategy possible.
At launch:
- jitoSOL is the sole staking asset
- jitoSOL is the sole collateral asset
- jitoSOL is the default asset held by the vault
As a result, every dollar deposited into ksUSD creates demand for jitoSOL.
We’re not asking Jito for capital.
We’re building a product whose success naturally increases demand for Jito’s core asset.
How ksUSD Works
ksUSD operates in three modes.
Normal Mode (Positive Funding)
- Hold jitoSOL
- Post jitoSOL as collateral
- Short SOL-PERP on Drift
The strategy earns:
- jitoSOL staking yield
- Funding payments
while remaining delta-neutral.
This is the primary operating state.
Users hold a dollar. The protocol holds staked SOL.
Reverse Mode (Deeply Negative Funding)
- Borrow jitoSOL on Kamino
- Sell borrowed jitoSOL
- Go long SOL-PERP
The strategy captures negative funding while maintaining a market-neutral position.
Idle Mode (Low Funding)
- Capital remains in lending markets
- No directional exposure is taken
Funding conditions determine which mode is active.
In the regime where ksUSD expects to spend most of its life, jitoSOL remains the collateral backing the system.
Why jitoSOL Specifically?
The strategy requires three things to exist in the same ecosystem:
- A perpetual market with programmable access
- A staking asset accepted as collateral
- A lending market supporting both assets
Solana is uniquely positioned because all three components can interact atomically inside a single program.
Among Solana’s liquid staking assets, jitoSOL currently provides the strongest combination of:
- Liquidity
- Lending integration
- Perpetual collateral support
- Ecosystem adoption
For that reason, Keystone launches with jitoSOL as its sole collateral asset.
Future expansion is possible, but launch prioritizes simplicity and risk management.
What Jito Gets
Direct jitoSOL Demand
In Normal mode, ksUSD is backed by jitoSOL.
As TVL grows, demand for jitoSOL grows alongside it.
Access to New Capital
Many investors want dollar exposure but cannot justify holding a price-exposed staking asset.
ksUSD allows those users to indirectly support jitoSOL while remaining dollar-denominated.
This creates demand from a different class of participant:
- Treasuries
- Market-neutral funds
- Yield allocators
- Dollar-based savers
A New Integration Pattern
Most products simply hold jitoSOL.
Keystone builds directly on top of it.
The result is a new source of staking demand driven by dollar issuance rather than SOL speculation.
Looking Ahead: JTX
Today, ksUSD’s funding leg is designed around Drift because it is the most mature venue for the type of bidirectional funding market the strategy requires.
That said, Drift is actively working towards relaunching following the April 2026 exploit.
For Keystone, that highlights an important principle: the protocol is fundamentally venue-agnostic. We need a funding market, not a specific funding market.
As JTX develops and accepts jitoSOL margin, it becomes a natural candidate for ksUSD’s hedge venue.
If JTX exposes the same level of programmatic composability, the strategy’s funding leg could eventually migrate onto Jito infrastructure.
That would place two of ksUSD’s three yield sources within the Jito ecosystem:
- jitoSOL for staking
- JTX for funding
From our perspective, this is one of the more interesting long-term alignment opportunities between Keystone and Jito.
A productive dollar generates recurring, rules-based hedge flow. A perpetual exchange needs predictable open interest and volume. Those two needs fit naturally together.
We’re still early, but we’d welcome an ongoing conversation around how ksUSD could compose with JTX as the venue matures.
Risks
Hedge Risk
jitoSOL collateral is hedged through a SOL-PERP position.
The hedge is what keeps ksUSD dollar-denominated rather than SOL-denominated.
Venue Risk
The funding leg currently depends on Drift.
Keystone is designed to launch alongside Drift’s relaunch and remains venue-aware as the market evolves.
Liquidity Risk
Minting and redemptions depend on healthy jitoSOL liquidity.
Launch sizing will remain conservative relative to available depth.
Funding-Cycle Risk
Demand for jitoSOL is highest during positive-funding environments.
During deeply negative funding periods, the strategy may borrow and sell jitoSOL as part of its hedge construction.
This is temporary and mean-reverting, but it is important to acknowledge openly.
Smart Contract Risk
ksUSD composes multiple protocols, including Jito, Drift, Kamino, and Jupiter.
The vault architecture will undergo a security audit before launch.
Importantly, Keystone is a user of Jito infrastructure.
No liabilities transfer to the DAO.
What We’re Asking For
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Technical review of how Keystone holds, sizes, hedges, and redeems jitoSOL collateral.
-
Risk guidance around liquidity assumptions and scaling relative to the broader jitoSOL market.
-
Ecosystem introductions to partners and integrations where a jitoSOL-backed productive dollar may compose well.
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An open dialogue around JTX, including whether future versions of ksUSD can integrate directly with Jito’s perpetual infrastructure.
We welcome community feedback and scrutiny.
We’re building in public and sharing our progress at @Keystone_Fi.
-– Keystone Finance
¹ Ethena demonstrated substantial demand for productive dollars. ksUSD explores a different implementation: fully on-chain, staking-integrated, and designed to capture both positive and negative funding environments.