Jupiter Lend, the newly launched lending protocol on Solana, has rapidly expanded its market presence by securing 13.56% of the network’s on-chain lending market share within a week of its public beta launch. Developed in partnership with Fluid DeFi and backed by $2 million in incentives, the platform introduced 40 active lending vaults and support for a range of stablecoins, including USDC, USDT, EURC, and wrapped Bitcoin derivatives such as cbBTC and xBTC. Jupiter Lend’s launch coincided with a significant shift in Solana’s DeFi landscape, where competition among lending protocols is intensifying and benefiting users with lower penalties and enhanced liquidity options [2].

Kamino, previously the dominant lending protocol on Solana, has responded to Jupiter Lend’s rise by significantly reducing its liquidation penalties. Effective September 1, Kamino slashed its minimum liquidation penalty from 1% to 0.1%, while also adjusting its liquidation process to allow for partial unwinding in 10% increments. The update aims to reduce financial stress on borrowers while maintaining a healthy level of risk management. Kamino’s cofounder, Marius Ciubotariu, noted that while smaller unwinding increments are less harsh, larger increments may be more effective in volatile or declining markets. The move is widely seen as a strategic response to Jupiter Lend’s growing influence [2].

Jupiter Lend’s liquidation engine has been a key differentiator in its rapid adoption. According to its COO, Kash Dhanda, the platform’s liquidation model and low penalties give it a “genuine edge” over existing protocols. These features are central to Jupiter’s broader ambition to become Solana’s DeFi superapp. Since its launch in August 2025, Jupiter has leveraged its existing infrastructure as a top DEX aggregator to integrate lending and other DeFi services. The platform now offers users the ability to deposit assets like JUP and JLP as collateral and borrow stablecoins, adding another layer of utility to Solana’s ecosystem [2].

The rise of Jupiter Lend is also having a measurable impact on Kamino’s total value locked (TVL). In the span of a week, Kamino’s TVL in $SOL declined by 8.75%, from 14.05 million $SOL to 12.82 million $SOL, according to DefiLlama data. While Kamino remains the largest lending protocol on Solana, with over $3 billion in liquidity and a clean track record of over $120 million in processed liquidations without any bad debt, the growing presence of Jupiter Lend is forcing the market leader to innovate. This competition is seen as beneficial to users, who are now presented with more options and better risk management tools [2].

Analysts note that the increased competition between Kamino and Jupiter Lend is indicative of a maturing DeFi market on Solana. The introduction of multiple lending protocols, including emerging platforms like Loopscale, is pushing developers to prioritize user experience and cost efficiency. As a result, users are gaining access to better rates, reduced penalties, and more transparent liquidation processes. The broader DeFi ecosystem on Solana has seen TVL grow to over $11.3 billion, with lending and money markets now playing a central role alongside DEX and trading activity [2].

Source: [1] title1 (https://app.kamino.finance/markets) [2] title2 (https://solanafloor.com/news/kamino-drops-liquidation-penalties-90-jupiter-lend-grows) [3] title3 (https://www.mitrade.com/insights/news/live-news/article-3-1073536-20250827)