Convert delta-neutral yield intorisk-asset yield.

Kestrel tokens earn yield in three ways:

1. Performing an on-chain carry trade.
2. Earning interest on lending platforms when others borrow your assets.
3. Receiving a share of all mint and burn fees.

The carry trade works by depositing the underlying token as collateral in Kamino, borrowing stablecoins at a low rate, and converting them into assets that earn a higher rate than the borrow cost. Earned interest is periodically reinvested into more of the underlying token, compounding returns over time.

Users never face liquidation risk — the protocol continuously rebalances debt to keep each vault safely inside its health band.

Rather than paying out claims, each yield-bearing token’s share price rises over time. Holding is the whole strategy — the token redeems for more of the base asset the longer you hold. Compare the two lines on any token detail page to see the gap widen.

Sell your yield-bearing token at the current share price to receive the matching collateral back. Sales settle inside the protocol’s cool-down window; the cooldown is there to keep redemptions fair for everyone in the vault.

A 10% performance fee applies to yield only, never to principal. Every APY you see on the site is already net of that fee.

Additionally, there are mint and burn fees (depending on the token), but a portion of these fees go to current holders as yield.