Documentation Index
Fetch the complete documentation index at: https://docs.exponent.finance/llms.txt
Use this file to discover all available pages before exploring further.
Like any DeFi protocol, using Exponent involves some risks for users.
Smart contract risks
Smart contracts powers blockchain applications like Exponent. While designed with security in mind, these self-executing programs can present risks:- Potential vulnerabilities despite security measures;
- Integration risks with multiple protocols and yield-bearing assets;
- Possible exploitation leading to loss of funds.
- All blockchain transactions are permanent and cannot be reversed;
- Errors in transactions cannot be undone;
- Users must verify all transaction details before confirmation.
Underlying protocols
An important aspect of Exponent is that every product/market offered is derived from other protocols and assets. This means that when operating on Exponent, users bear counterparty risks and should ensure they understand these underlying protocols. As such, Exponent can be seen as a “marketplace” that provides access to derivative assets/markets of DeFi products. Exponent does not own or manage these third-party protocols and contracts and consequently is not responsible for any funds lost due to exploits in these third-party contracts.Liquidity
Each market on Exponent has secondary liquidity, supplied by liquidity providers and/or market makers. Liquidity shortages could prevent Exponent users from operating effectively before maturity, impacting the ability to exit a trade, for example. However, regardless of liquidity conditions:- Yield traders will always receive their yield and emissions.
- Principal Token holders can always redeem the underlying asset at maturity.
Declining value risk when yield trading
While not a protocol risk in itself, it is important for users to remember that trading stripped variable yields (Yield Tokens) with maturities means that upon expiry those positions become worthless – unlike underlying yield assets (e.g. SOL), which always retain a market price. Traders need to keep this in mind when opening a position.Protocol Fees
Exponent charges fees across different product surfaces depending on the action being performed and the market being used. Fees may apply to trading, liquidity provision, and Strategy Vault participation.Trading Fees
When trading on Exponent markets, users may pay protocol fees on swaps executed through the relevant market venue. These fees can vary depending on the liquidity venue used, such as the Rate Order Book or the Rate CLMM, and may also evolve depending on the market configuration. For fixed-maturity yield markets, fee behavior may change as maturity approaches. In some cases, protocol fees may decrease over time as the market nears expiry.Liquidity Fees
Liquidity providers do not pay a separate protocol fee to deposit liquidity, but their positions are subject to the fee configuration of the market they provide liquidity to. Trading activity through that market generates fees, which are shared with active liquidity providers according to the market’s design. Depending on the venue and market, fee levels may be fixed or dynamic.Strategy Vault Fees
Strategy Vaults may charge additional fees set by the vault manager. These can include:- Management fee: a fee charged for managing the vault over time
- Performance fee: a fee charged on positive performance generated by the vault
- Withdrawal fee: a fee charged when withdrawing from the vault, where applicable
Third-Party Fees
Some Exponent products and strategies interact with third-party protocols on Solana. In these cases, users may also be indirectly exposed to fees charged by those protocols, such as swap fees, borrow fees, lending fees, vault fees, or other execution-related costs.Network Fees
Because Exponent runs on Solana, users must also pay standard network transaction fees when interacting with the protocol. These fees do not go to Exponent.Important Notes
- Fees can differ across markets, maturities, and product surfaces.
- Some campaigns may temporarily reduce or remove certain fees.
- Always review the relevant market or vault interface before confirming a transaction.