High-Yielding Synthetic SOL

pikSOL and pitSOL are Parity’s synthetic SOL products, designed to deliver enhanced yield while maintaining SOL exposure and capital efficiency.

How Yield is Generated

Yield on synthetic SOL is powered by three coordinated mechanisms:

1. JLP Trading Commissions

Parity allocates capital into the JLP pool, which powers Solana’s leading Perps DEX, earning a share of trading fees and funding from perpetuals traders.

2. Perpetual Funding Rates

When funding rates are negative, Parity may open long SOL positions on decentralized (Drift) or centralized (Binance) perpetual exchanges, collecting funding fees for its long SOL exposure.

3. Validator Rewards (Dynamic Switching)

When blockchain-native staking rewards (validator yield) exceed market-based returns, Parity dynamically reallocates capital to traditional staking — ensuring users earn at least as much as they would via traditional staking providers. This switching mechanism guarantees baseline staking performance with upside when market conditions are favorable.

Maintaining SOL Exposure and Peg

To ensure that synthetic SOL 1:1 tracks the performance of native SOL:

• The protocol uses a combination of JLP pool exposure, SOL-denominated derivatives, and validator staking

• This allows Parity to mirror SOL’s price behavior 1:1 while capturing yield from multiple sources

The peg is maintained through:

• Redeemability of synthetic SOL at par value for SOL at any time

• Real-time asset-liability matching

• A transparent dashboard displaying real collateral composition

pikSOL and pitSOL are always backed by yield-generating collateral, with built-in protections to prioritize peg stability and risk-adjusted yield.