Solana DeFi protocol Hylo has announced Hylo V2, its most significant update yet, expanding its offerings with a broader suite of leveraged onchain assets. The update introduces the xAsset Engine, a framework designed to support leveraged exposure across cryptocurrencies, equities, commodities, and yield-bearing assets.
The launch represents Hylo's attempt to tap into a market that traditional finance has already validated. According to the protocol, leveraged ETFs currently hold roughly $180 billion in assets in the United States and account for approximately 12% of daily ETF trading volume. The category has grown at an annual rate of 29% since 2020.
Hylo argues that while traditional leveraged ETFs have attracted significant retail participation, onchain markets have yet to offer a comparable product with similar accessibility and composability.
Bringing Leveraged Equities Onchain
One of the most notable additions in Hylo V2 is xEquities, a category that will provide leveraged exposure to tokenized stocks and major equity indexes. According to Hylo, future products could include assets linked to names such as TSLA, MSTR, SPY, and NDAQ.
The broader xAsset framework will include four categories. xCrypto will offer leveraged exposure to cryptocurrencies such as $SOL, $BTC, and other digital assets. xEquities will focus on tokenized stocks and equity indexes. xCommodities will cover assets such as gold, silver, and oil. xYield will target leveraged exposure to yield-generating assets.
The introduction of equities and RWAs follows comments by Hylo’s pseudonymous co-founder and CEO, Plish, last month, in which he outlined plans to diversify the protocol beyond its original focus on Solana liquid staking tokens.
Retiring the Stability Pool
Another major component of Hylo V2 involves replacing the Stability Pool with a new Earn Pool model. The Stability Pool previously played a critical role in protecting $hyUSD's collateral ratio during periods of stress. According to Hylo, the mechanism deployed approximately $8 million into xSOL across 59 transactions over a three-month period, generating more than $763,000 in profit for $sHYUSD holders. Under the new system, Hylo plans to rely on market-driven rebalancing supported by arbitrage and liquidity providers.
When collateral values decline and leverage rises, the protocol can sell assets and replace them with $USDC. When leverage falls, available $USDC can be used to acquire additional collateral. Hylo believes this process will reduce volatility decay, keep more value within the ecosystem, and provide more predictable behavior for stablecoin users.
Multi-Asset Collateral and hyUSD Growth
Hylo V2 also introduces a multi-asset collateral architecture. The original version of the protocol relied primarily on Solana liquid staking tokens as backing collateral. Under the new model, users will be able to mint $hyUSD against multiple supported assets through a dynamic routing system.
The protocol also plans to accept $USDC as overflow collateral when demand exceeds the collateral ratio limits. According to Plish, Hylo is exploring opportunities to deploy that liquidity into tokenized treasury products to generate additional yield. The expansion beyond $SOL reflects the team's goal of creating a more diversified and resilient collateral base that includes Bitcoin, real-world assets, and other yield-bearing instruments.
$xSOL Remains a Core Product
Although Hylo is broadening its focus, $xSOL remains central to the protocol. The leveraged $SOL token has been live since July 2025 and remains Hylo's flagship leveraged product.
$xSOL currently maintains approximately $17.08 million in $SOL open interest. Among Solana-based trading venues, only Jupiter Perps currently reports higher $SOL open interest. Other platforms trail significantly, including Pacifica at $5.56 million, GMTrade at $2.6 million, Phoenix at $2.2 million, and FlashTrade at approximately $392,000. Hylo has previously highlighted this position as evidence that demand exists for alternative leveraged exposure products beyond traditional perpetual futures.
The Accretion audit for Hylo V2 is now nearly complete. If the rollout proceeds as planned, the protocol will enter its next phase with a significantly expanded product suite and a strategy focused on bringing leveraged exposure across multiple asset classes to the Solana ecosystem.
Read More on SolanaFloor
Ondo Lists 173 New Stocks and ETFs as Solana Records All-Time High in Tokenized Equity Trading Volume
Collector Crypt’s $4 Million Airdrop Arrives as Weekly Revenue Hits $4 Million ATH
We Placed the Same Trade on 6 Perps Venues and Here's What Happened!
