In the fast-paced world of DeFi on Solana, market dips can test the resilience of lending protocols. Recently, between November 19 and 21, Solana's native token SOL experienced a 14% drop from $142 to $122, triggering a significant deleveraging event across the ecosystem. Kamino Lend, a prominent DeFi lending platform, stepped up to the challenge, processing $5.5 million in liquidations across 4,251 events— all without incurring any bad debt.

This performance highlights the strength of Kamino's risk management system, as detailed in a recent analysis by Allez Labs. The median loss for affected users was a mere 0.08% of their position size, showing how effectively the protocol minimizes damage during volatile periods.

Breaking Down the Event

The deleveraging unfolded gradually at first. On November 19 and 20, SOL trended lower with relatively light liquidation activity. Then, on November 21, things intensified: 89% of all liquidations happened that day, with a peak of 1,523 events in a single hour around 7am UTC as SOL plunged to its low.

Kamino's system handled this surge smoothly, thanks to Solana's high throughput— no network congestion or fee spikes disrupted the process. This is a big win for DeFi users who rely on quick, efficient transactions during stress tests.

Liquidation Details: Collateral and Debt

Diving into the numbers, the collateral seized during these liquidations was dominated by liquid assets:

• SOL: 51.7% ($2.85 million)
• JLP (Jupiter Liquidity Provider tokens): 20.7% ($1.14 million)
• cbBTC: 12.8% ($706,000)
• xBTC: 4.5% ($248,000)

On the debt side, repayments were mostly in stablecoins:

• USDC: 82.4% ($4.50 million)
• USDG and PYUSD: About 6% each ($300,000 combined)

This focus on highly liquid assets ensured smooth liquidation flows, reducing slippage and protecting the protocol's overall health.

Market Breakdown and User Impact

Liquidations were concentrated in Kamino's deepest liquidity pools:

• Main Market: 75% ($4.12 million)
• JLP Market: 21% ($1.14 million)
• Other markets: 4% ($257,000)

This concentration in liquid venues is ideal for stress events, as it minimizes execution risks.

For users, the impact was minimal. About 1,866 wallets were affected, but thanks to partial liquidations— a feature that only closes the risky portion of a position— losses stayed low. Total liquidation fees amounted to just $61,500 on the $5.5 million seized.

Kamino's partial liquidation model is a key differentiator, helping users retain most of their positions while bringing them back to safe health factors.

Liquidator Network and Position Insights

The event also showcased a maturing liquidator ecosystem on Kamino:

• 145 active liquidators (up from 114 in October)
• One liquidator handled over $1 million in volume
• Nine processed more than $100,000 each

This growing decentralization improves execution efficiency and keeps costs down for liquidated users.

Positions were somewhat concentrated, with the top five wallets accounting for 43.5% of liquidations. However, only three wallets saw over $200,000 liquidated, and most (1,857) were under $100,000— indicating broad but controlled exposure.

Comparison to Past Events and Overall Activity

Compared to a similar event on October 10— where $20 million in liquidations occurred amid a 19.5% SOL drop— this one was smaller despite comparable volatility. It suggests users are adopting more conservative strategies, learning from past dips.

During the three-day period, Kamino saw $3.7 billion in transaction volume, balanced between deposits/withdrawals ($1.7 billion each) and borrows/repayments ($116 million and $101 million). This orderly activity points to mature user behavior, not panic selling.

Key Takeaways for DeFi Users

Kamino's performance reinforces why it's a go-to for Solana DeFi enthusiasts, including those trading meme tokens that often involve leveraged positions. No bad debt, efficient partial liquidations, and a robust liquidator network mean users can borrow and lend with greater confidence, even when markets turn volatile.

For more in-depth data, check out the Kamino liquidation dashboard from Allez Labs. As Solana continues to grow, protocols like Kamino are setting the standard for risk-managed DeFi.