Keystone Returns to Jupiter DAO With Narrower ksUSD Proposal: "Narrower, Correct, and Honest"

Keystone Finance has submitted a second proposal to the Jupiter DAO, asking the community to make Jupiter V6 the primary execution layer for ksUSD, its forthcoming productive dollar on Solana. The proposal, published on the Jupiter governance forum on May 31, includes no request for treasury funding — a deliberate departure from the team’s earlier March proposal.

In the post, Keystone openly reflects on its first attempt. The original proposal sought treasury support and centered part of the strategy around Jupiter Perps. After further research, the team concluded that Jupiter Perps was not the right venue for ksUSD’s funding-capture strategy. “The first attempt ran the perp leg on Jupiter Perps, which uses a borrow-fee model (shorts pay into JLP), not a two-sided funding market,” the team wrote. “For a delta-neutral short, that fee erases the funding yield — there’s nothing to receive, only a fee to pay.”

The revised design moves the perpetuals component to Drift while positioning Jupiter as the protocol’s execution and routing layer for spot transactions. Keystone summarized the change as being “narrower, correct, and honest.”

How ksUSD works

ksUSD is pitched as a fully on-chain answer to Ethena's USDe. Users deposit USDC, mint ksUSD 1:1, and the protocol generates yield from three Solana-native sources: Drift perpetuals funding, jitoSOL staking rewards, and Kamino lending. The strategy is delta-neutral and runs in three modes — Normal, Reverse, and Idle — flipping based on funding-rate conditions.

Every spot conversion the strategy makes routes through Jupiter. "The funding, staking, and lending legs are each active in only some modes — Jupiter is active in all of them," the team wrote, framing best-execution routing as the difference between a basis trade that earns and one that leaks yield to slippage. Ethena's USDe, the comparable off-chain product, peaked above $14 billion in late 2025 and sits near $4.5 billion today, per DefiLlama.

Not competing with jupUSD

Keystone is explicit that ksUSD is not positioned against jupUSD, Jupiter's own reserve-backed stablecoin built on Ethena infrastructure and backed by BlackRock's BUIDL. "jupUSD is a settlement dollar... ksUSD is a carry instrument," the team wrote, noting the two are uncorrelated by construction: jupUSD tracks T-bill rates, ksUSD tracks the Solana basis. "A Solana treasury could reasonably hold both — jupUSD as the dollar it settles in, ksUSD as the dollar it earns in."

What Keystone is asking for

The proposal requests three concrete things from the Jupiter community: a routing review of the integration, MEV guidance to protect predictable rebalance flow from sandwich attacks, and liquidity coordination on the USDC ↔ jitoSOL pair as ksUSD scales. No tokens, no grants, no treasury draws.

"Keystone is a user of Jupiter's router — not a claim on Jupiter's treasury," the team wrote. "No liabilities transfer to the DAO."

The proposal is live for community discussion. v1 scope locks the integration to Jupiter V6 for spot routing, jitoSOL-only collateral, Kamino-only lending, Drift as the sole perp venue, with a conservative TVL cap and a vault audit before launch.