Glossary of Solana DeFi terms

Want deeper context? Book a vocabulary intensive or read our field notes. Terms below are alphabetical.

AMM (Automated Market Maker)

A pool-based trading model where prices emerge from token ratios rather than an order book. On Solana, Raydium and Orca are common examples.

APR / APY

Annualised return figures shown on pool pages. APR excludes compounding; APY assumes rewards are reinvested. Neither guarantees future returns.

Bridge

Infrastructure that locks assets on one chain and mints a representation on another. Trust model depends on guardians or light clients.

Collateral

Assets pledged in a lending market to secure a borrow position. Liquidation occurs if collateral value falls below protocol thresholds.

Epoch

A Solana time period (~2–3 days) used for stake activation, deactivation, and reward distribution.

Impermanent loss

The difference in value between holding tokens separately versus providing them as liquidity, measured at withdrawal.

LP token

A receipt token representing your share of a liquidity pool. Redeeming it withdraws your proportional reserves plus earned fees.

Oracle

An on-chain price or data feed, often from Pyth or Switchboard, used by lending and derivative protocols.

Receipt token

An SPL token representing a claim on staked SOL or another deposited asset, e.g. mSOL or JitoSOL.

Slippage

The difference between expected and executed trade price. Slippage tolerance sets the maximum acceptable deviation.

TVL

Total value locked — the dollar value of assets held in a protocol or pool at a given moment.

TWAP

Time-weighted average price; a smoothed price feed used to reduce manipulation on some perpetual markets.

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