If you're into meme tokens on Solana, you've probably heard of Kamino Finance – it's one of the go-to DeFi platforms for lending and borrowing. Recently, Allez Labs dropped their monthly risk insights for Kamino Lend covering September 2025, and it's packed with juicy details. From skyrocketing stablecoin adoption to some rough patches for meme coins, this report shows how the DeFi landscape is shifting. Let's break it down in plain English, especially focusing on what it means for meme token enthusiasts.

Vaults Explode: A New Era for Stable Yields

One of the biggest highlights? Kamino's vaults absolutely crushed it last month. These are essentially automated strategies where you deposit assets like stablecoins, and the protocol lends them out across various markets to earn yield for you. Think of it as a smart savings account on steroids.

In September, vault supplies doubled – yeah, up 200% to a whopping $593 million. That's thanks to over 14,500 cumulative suppliers jumping in. Leading the pack:

• USDC Prime Vault: Grew 52% to $267 million, curated by Steakhouse Finance and routing funds to main markets.
• Sentora PYUSD Vault: Launched this month and hit $189 million right out the gate.
• Allez USDC Vault: Up 54% to $63 million, spreading deposits across 10 different markets.

Why does this matter for meme traders? Well, these vaults are funneling stablecoins into lending markets, creating more liquidity. If you're borrowing against your volatile meme holdings, this stable influx could mean better rates and less risk of sudden squeezes. But as we'll see, volatility still bit hard.

Stablecoins Take the Wheel: Up 15% and Beyond

Stablecoins were the stars of the show, with Kamino Dollar supply climbing 14.7% to $973 million and debt up 19% to $746 million. Utilization sat at a healthy 76.6%, meaning most of that capital is actively being borrowed and put to work.

Key movers:

• PYUSD led with $169 million in new supply inflows.
• USDC wasn't far behind, adding $96.5 million, boosted by those vault strategies.
• Even cbBTC (a Bitcoin-wrapped token) surged with $139 million more in supply, signaling rising interest in BTCFi – using Bitcoin in DeFi.

On the flip side, SOL (Solana's native token) saw contractions: supply down $101 million, debt down $129 million. This shift toward stables suggests users are playing it safer amid market swings, which ties directly into the meme coin drama.

For meme token holders, this stablecoin boom is a double-edged sword. More stable liquidity means easier borrowing to leverage positions, but it also highlights how memes are getting sidelined when things get choppy.

Transaction Volume Hits Records, But Volatility Strikes

Overall transaction volume on Kamino reached a new peak at $12.3 billion, up 3.4% from August. Deposits jumped 20% to $5.68 billion, borrows soared 44.5% to $1.1 billion, but repayments dropped 33.9% to $661 million. Liquidations also spiked to $12.3 million – a sharp increase, though still tiny compared to total volume.

The end of September brought some nasty volatility: SOL dropped about 25%, and memecoins plummeted over 40%. This led to $6.5 million in collateral liquidated, mostly in SOL, JitoSOL, and – yep – Fartcoin. If you're holding meme tokens like Fartcoin or Bonk (which is mentioned in smaller v2 markets gaining traction), this is a wake-up call. These assets are fun, but they can get wrecked in downturns, especially if you're leveraged on platforms like Kamino.

The good news? All positions were cleared smoothly, with liquidators earning just 0.07% on affected positions. No bad debt for the protocol, thanks to deep liquidity and solid infrastructure.

Core Metrics and Market Breakdowns

Here's a quick snapshot of the big-picture numbers for September:

• Total Supply: $4.4 billion (+4.9%)
• Total Debt: $1.6 billion (+0.1%)
• TVL: $2.8 billion (+7.8%)
• Interest Paid: $10.1 million (flat)
• Liquidations: 2,289 events
• Collateral Seized: $6.3 million

The Main Market remains the powerhouse, with $3 billion in supply (70% of the protocol) and $1.2 billion in debt. Other trends:

• RWA (Real World Assets) markets like Huma exploded 400% to $7.5 million, OnRe up 44% to $13.1 million.
• Maple: $75 million supply, $51 million debt (+25.7%).
• Jito: $278 million supply, $129 million debt.
• Marinade: $139 million supply, $65 million debt.

Smaller markets like Bonk and Adrena are showing early promise, which could be exciting for meme coin degens looking for niche lending opportunities.

Stress Tests: Kamino's Resilience Shines

Allez Labs ran stress tests to see how Kamino holds up in crashes:

• 30% market drop: $223 million collateral at risk, potential $10.6 million bad debt.
• 60% crash: $1.03 billion at risk, $115 million bad debt.

Risk is contained, but it's a reminder that in extreme scenarios, volatile collaterals like meme coins could amplify losses. Kamino's setup – with deep Solana liquidity – helps buffer shocks, but always DYOR and manage your leverage.

What This Means for Meme Token Traders

September's report paints a picture of a maturing DeFi ecosystem on Solana. Stablecoins and vaults are driving growth, making Kamino more accessible for yield farmers. But for meme coin holders, the volatility spike and liquidations in assets like Fartcoin highlight the risks. If you're borrowing against memes, consider rotating some into stables or BTC for stability.

Kamino is entering Q4 stronger, with diversified foundations. Want the full scoop? Check out the complete report on Kamino's governance forum.

Stay tuned to Meme Insider for more updates on how DeFi trends affect your favorite meme tokens!