JLP Hedge Vault Pro
Delta-Neutral Vault Flagship – Now More Efficient
Introducing JLP Hedge Vault Pro: The Upgraded Standard for Hedged JLP Yields.
JLP Hedge Vault Pro is PrimeNumber's advanced vault that delivers leveraged, delta-neutral USDC returns from the JLP token. It amplifies JLP exposure via Solana lending protocols and dynamically hedges delta risk across leading perps DEXs, all within a secure, multi-protocol framework.
Funds are strategically deployed across:
• Solana Lending Protocols (e.g., Jupiter Lend, Kamino, Drift) to borrow against JLP and increase exposure. • Perpetual Futures Exchanges (e.g., Drift, Hyperliquid, Aster) to execute precise delta-hedging.
Yield Generation
Returns are generated from two synergistic, non-correlated sources:
Leveraged JLP Base Yield
The vault earns the native yield from JLP—composed of perpetual funding, swap and trading fees.
By leveraging exposure through cross-protocol borrowing at optimized rates, the strategy significantly enhances this base yield component.
Cross-Exchange Funding Rate Capture
The delta-hedging short positions on perpetual exchanges earn funding fees, which are typically positive in trending or bullish markets.
Executing hedges across multiple venues allows the vault to seek the most favorable funding rates and deepest liquidity, improving execution quality and adding a steady income stream.
This combined engine delivers robust, real yield that aims to be resilient across various market conditions.
Dynamic, Multi-Venue Delta Hedging
The vault maintains delta neutrality through an automated, precision-hedging system:
Real-Time Monitoring: The system continuously tracks the value and composition of the leveraged JLP position.
Multi-DEX Execution: Hedge orders are placed across several perpetual DEXs using primarily limit orders to minimize slippage and trading costs.
Automated Rebalancing: Hedge ratios are automatically adjusted in response to market moves and changes in the JLP pool, ensuring consistent delta neutrality.
The hedging infrastructure includes real-time risk controls and circuit breakers to manage positions during periods of extreme volatility.
Cross-Protocol Collateral Management & Rebalancing
Capital is deployed across lending protocols and perp DEXs. An automated rebalancing system ensures optimal allocation:
In Rising Markets: As JLP value increases, hedge positions on perp DEXs may become under-collateralized. The system automatically borrows additional USDC and transfers collateral to strengthen margin buffers and prevent liquidation.
In Declining Markets: Profitable hedge positions release excess collateral, which is then used to repay debt on lending protocols, reducing borrowing costs and freeing up capital efficiency.
This continuous process maintains the health of all positions while maximizing the utilization of capital.
Security & Infrastructure
Custody & Deployment
Institutional MPC Custody by Cobo/Fordefi: All assets are secured under a multi-party computation (MPC) custody framework. This enables secure, policy-controlled, and automated deployment across integrated protocols without exposing private keys.
Smart Contract Architecture
Voltr Audited Framework: The vault is built on Voltr, a fully audited, modular smart contract framework designed for on-chain vaults and automated strategies, ensuring security, upgradability, and transparency.
Protocol & Operational Security
Integrated lending and perpetual DEXs are selected for their liquidity, maturity, and security track records.
The automated keeper system operates with high availability and includes fallback mechanisms and monitoring alerts.
Key Parameters
• Leverage Cap: Maximum 3x (Total JLP Exposure / Vault NAV). • Target Pre-Fee APY: 18% – 22% (based on recent ~9% JLP base yield). • Redemption Period: 3 days.
Fees
• 1% annual management fee • 25% performance fee • 0.3% redemption fee
Comparison with JLP Hedge Vault: From Single-Platform to Multi-Protocol
The original JLP Hedge Vault strategy validated the demand for delta-neutral JLP yield. However, its reliance on a single platform created key inefficiencies.
JLP Hedge Vault Pro is the evolved solution. It solves these limitations by operating across a network of optimized DeFi protocols, leading to measurably higher returns and better risk management.
Quantitative Edge: A Real-World Example
Here’s how a multi-protocol approach directly translates to higher net yield for users.
Platform for Borrowing
Drift Lending (~7% APY cost)
Jupiter Lend / Kamino (~5% APY avg. cost)
Lower Financing Cost
Platform for Hedging
Drift Perps (~0% avg. funding rate)
Hyperliquid / Aster (~+2% APY from funding)
New Revenue Stream
Net Pre-Fee APY (Assumes 3x Leverage & 9% JLP Base Yield)
~13% APY 27% (Gross Yield) - 14% (Borrow Cost)
~23% APY 27% (Gross Yield) - 10% (Borrow Cost) + 6% (Funding)
+10% APY
After-Fee APY
~10.4% APY (20% performance fee)
~16.5% APY (1% magt fee and 25% performance fee)
+6.1% APY
Explanation: This example shows how our strategy actively sources cheaper capital (saving 2% on borrowing) and captures funding income on other exchanges (adding 3%). The combined benefit boosts the net pre-fee APY by approximately 50%~100% compared to the single-platform model.
The Bottom Line: Higher Net Yield
By separating the functions of borrowing and hedging—and dynamically choosing the best venue for each—JLP Hedge Vault Pro directly converts infrastructure efficiency into superior, risk-adjusted returns for depositors.
Risk Disclosure
As with all DeFi strategies, the JLP Hedge Vault Pro involves inherent risks:
Smart Contract Risk: Despite audits, vulnerabilities may exist in the underlying integrated protocols, the Voltr framework, or the vault's own strategy logic.
Execution & Hedging Risk: Extreme market volatility, network congestion, or liquidity gaps can lead to slippage, delayed orders, or momentary hedge imprecision. Mitigations include limit orders, multi-venue execution, and circuit breakers.
Leverage & Liquidation Risk: The use of leverage amplifies both gains and losses. A sharp decline in collateral value or a spike in borrowing rates could lead to liquidation. The strategy employs risk thresholds and automatic de-leveraging triggers.
Custodial Dependency Risk: The strategy relies on third-party MPC custodians (Cobo/Fordefi). While they are industry leaders, this introduces a dependency.
Protocol Dependency Risk: Strategy performance depends on the continued yield generation of JLP and the funding rate environment, which are subject to change based on market conditions and protocol updates.
Target Audience
The JLP Hedge Vault Pro is built for:
Investors seeking non-directional, yield-focused exposure in DeFi.
Those who prioritize institutional-grade security, risk management, and operational transparency.
Individuals and institutions looking for scalable, automated strategies that leverage advanced DeFi primitives.
Sophisticated users who understand the mechanics and risks associated with leverage, delta-neutral strategies, and multi-protocol interactions.
Commitment to Transparency
We believe transparency is fundamental:
All vault positions are verifiable via dedicated, on-chain wallet addresses.
Regular Net Asset Value (NAV) and performance reports are published.
Users are notified in advance of any significant parameter adjustments or protocol upgrades.
JLP Hedge Vault Pro — Capture consistent yield through market cycles. Build trust through complete transparency.
For further details, please contact the team.
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