Jupiter COO Says Vault’s ‘Zero Contagion’ Claim Was Not Fully Accurate

Jupiter acknowledged its vaults allow rehypothecation despite earlier claims of isolation, prompting criticism from Solana lenders concerned about undisclosed systemic risk.

Jupiter’s Chief Operating Officer Kash Dhanda admitted that prior claims about Jupiter Lend’s vaults having “zero contagion risk” were “not a hundred percent correct,” following backlash over how the vaults are actually designed and managed.

Although Jupiter describes its vaults as isolated, the protocol allows rehypothecation or recollateralization of deposited assets to improve capital efficiency, meaning collateral from one vault can be reused within a wider liquidity structure.

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Prior social media posts that described the vaults as such were deleted by the Jupiter team.

“We deleted it to avoid it kind of going any further. In hindsight we should have issued a correction right when we deleted it,” said Dhanda.

Earlier this week, Solana lending platform Kamino blocked Jupiter Lend’s migration tool, citing concerns that Jupiter’s risk model and “zero contagion” messaging was misleading users about true systemic risk.