Moderate risk — innovative oracle-free design with strong growth, but novel mechanics and short track record mean it has not yet been tested by market stress.
Top Risks
1
Novel dual-token system (hyUSD + xSOL) with zero-liquidation leverage is untested at scale; oracle-free design eliminates one risk but introduces novel pricing mechanics that lack extensive battle-testing
2
hyUSD is backed entirely by SOL LSTs, creating strong correlation risk — a decline in SOL price directly impacts the collateral ratio even though the stablecoin targets a USD peg
3
Protocol launched publicly in June 2025 with under 1 year of track record, limiting confidence in edge-case behavior during extreme market conditions
4
xSOL leveraged exposure up to 4x means the system absorbs significant volatility; in a sustained SOL downturn, xSOL holders bear amplified losses while hyUSD collateral ratio compresses
Risk Breakdown
Frequently Asked Questions
Is Hylo LSTs safe to use?
Hylo LSTs receives a B risk grade (26/100) from Hindenrank, where lower scores indicate lower risk. Moderate risk — innovative oracle-free design with strong growth, but novel mechanics and short track record mean it has not yet been tested by market stress. Hylo LSTs is a Solana DeFi protocol offering two products: hyUSD, a stablecoin backed by Solana liquid staking tokens, and xSOL, which provides up to 4x leveraged SOL exposure without liquidation risk. The protocol is notable for operating without external price oracles, instead relying on on-chain LST redemption rates. With $19M in TVL and launched in June 2025, it features innovative but untested mechanics.
What are the main risks of using Hylo LSTs?
The key risks identified for Hylo LSTs are: (1) Novel and untested design: Hylo's zero-liquidation leverage and oracle-free pricing are innovative but have not been tested through a severe market downturn. New mechanics can behave unpredictably in extreme conditions. (2) SOL price exposure: hyUSD is backed entirely by SOL-based liquid staking tokens, meaning a large SOL price decline directly threatens the stablecoin's collateral backing. This is different from stablecoins backed by fiat or T-bills. (3) Short track record: The protocol launched publicly in June 2025 with less than a year of operation. While growth has been strong, newer protocols are inherently riskier until they survive multiple market cycles.
What is Hylo LSTs's risk score breakdown?
Hylo LSTs scores 26/100 across eight risk dimensions: Mechanism Novelty: 6/15, Interaction Severity: 5/20, Oracle Surface: 0/10, Documentation Gaps: 2/10, Track Record: 5/15, Scale Exposure: 3/10, Regulatory Risk: 2/10, Vitality Risk: 3/10. The highest risk area is Mechanism Novelty at 6/15.
How does Hylo LSTs compare to other Liquid Staking protocols?
Among 81 rated Liquid Staking protocols on Hindenrank, Hylo LSTs ranks #18 by safety (lowest risk score = safest). Its 26/100 risk score and B grade place it among the safer Liquid Staking protocols.
Has Hylo LSTs ever been hacked or exploited?
Hylo LSTs scores 5/15 on the Track Record risk dimension, indicating some history of security incidents or exploits. Higher scores reflect more severe or frequent incidents. Review the full risk report for details.