How Does Sanctum Work?

Infinity Pool: multi-LST liquidity pool enabling swaps between all supported Solana LSTs with minimal slippage

Infinity is a groundbreaking multi-LST liquidity pool that allows efficient swaps between all supported LSTs. With 40,000+ holders and $1.3B+ TVL, it aggregates yield across the entire Solana LST ecosystem. INF token represents a share of the diversified pool. Infinity V2 (March 2026) introduced slot-level continuous yield streaming, reducing epoch-boundary settlement risk but adding new smart contract surface area.

INF token: reward-bearing LST aggregating yield from all underlying LSTs in the Infinity pool

INF token accrues yield from all underlying LSTs in the pool, providing diversified staking exposure. Sanctum claims INF offers superior yield due to aggregation across multiple validator strategies. As of Infinity V2 (March 2026), INF streams yield continuously per slot rather than at epoch boundaries, improving smoothness but requiring updated staking math contracts.

Router: automated swap routing engine finding optimal LST-to-LST exchange paths

Sanctum Router finds the best swap path between any two LSTs, potentially routing through multiple intermediate tokens. Standard DEX aggregation pattern applied specifically to LSTs.

Reserve Pool: ~400,000 SOL idle pool enabling instant LST-to-SOL conversion for a small fee

The Reserve Pool holds idle SOL that allows users to bypass the one-epoch unstaking wait by paying a small fee. Acts as a liquidity buffer but can drain during stress events.

CLOUD governance token with futarchy-based voting over protocol parameters

CLOUD launched via Jupiter LFG Launchpad with 1B total supply, ~567M circulating as of May 2026. Governance uses futarchy at vote.sanctum.so. CLOUD-1 (2026) passed CLOUD staking and Active Staking Rewards (30M CLOUD over 6 months). No fee distribution to CLOUD holders yet per DeFiLlama data. Token is at near all-time lows ($0.02, FDV ~$20M) with -86% performance over 12 months.

Wonderland points-to-CLOUD airdrop: retroactive distribution based on LST swap activity

Sanctum's Wonderland campaign distributed points convertible to CLOUD tokens. Standard points-to-token conversion model with potential Sybil farming concerns.

Validator delegation via curated LST set: Infinity pool delegates to validators backing accepted LSTs

Sanctum indirectly delegates stake through its supported LSTs, each of which delegates to different validator sets. The curation of which LSTs are accepted into Infinity is a key risk parameter. Sanctum's own validator scaled to ~2M SOL staked in Q1 2026.

If any LST in the Infinity pool depegs, arbitrageurs will swap the depegged LST into the pool (buying at discount, redeeming at par), concentrating toxic assets in the pool and diluting INF holders. The pool acts as a toxic-asset sink during LST stress events.

The ~400,000 SOL reserve enables instant LST-to-SOL conversion, but during a stress event, early redeemers drain the reserve, leaving remaining INF holders with only the one-epoch unstaking delay path. This first-mover advantage creates classic bank run dynamics.

INF is used as collateral across Solana DeFi (Marginfi, Kamino). An INF depeg caused by underlying LST failures would trigger cascading liquidations across all protocols accepting INF as collateral.

Sanctum's power is enabling long-tail LSTs (small validators) to achieve liquidity through Infinity. But including poorly-secured or low-stake validators' LSTs increases the probability of a depeg event within the pool.

Multiple LSTs may delegate to overlapping validator sets. A correlated validator failure (network partition, slashing event) could simultaneously depeg multiple LSTs in the Infinity pool, amplifying losses beyond a single-LST scenario.