Leverage Trading
Kona Lend's leverage trading lets you open amplified long, short, and yield loop positions in a single transaction using flash loan loops. All positions are non-custodial — funds are held in the Kona Lend pool under your wallet address. The looper contract never holds assets between transactions.
How It Works
Under the hood, leverage is achieved through flash loan loops on the Kona Lend pool:
You deposit collateral (e.g. 100 PENGU).
The KonaLooper contract takes a flash loan for the additional capital needed.
It supplies the total collateral to Kona Lend and borrows against it in one atomic transaction.
The flash loan is repaid from the borrow proceeds.
The result: you end up with a leveraged position (more collateral supplied, debt owed) — all in a single click.
Position Types
Long
Profit when the asset price goes up.
You deposit the volatile asset (e.g. PENGU or WETH).
The looper supplies it as collateral, borrows a stablecoin (USDC), swaps it for more of the volatile asset, and re-supplies.
Your position gains value when the collateral appreciates vs. the debt.
Long PENGU
PENGU
USDC
Up to 1.8x
Long WETH
WETH
USDC
Up to 4.0x
Short
Profit when the asset price goes down.
You deposit a stablecoin (USDC).
The looper supplies it as collateral, borrows the volatile asset (e.g. WETH), swaps it for more USDC, and re-supplies.
Your position gains value when the borrowed asset drops in price vs. your stablecoin collateral.
Short PENGU
USDC
PENGU
Up to 3.5x
Short WETH
USDC
WETH
Up to 3.5x
Yield Loop
Earn amplified lending yield with no directional price risk.
You deposit an asset (e.g. PENGU) and the looper loops it: supply PENGU, borrow PENGU, supply again.
Since collateral and debt are the same token, there is no liquidation price from oracle moves — only interest rate risk.
You earn supply APY on the full leveraged amount and pay borrow APY on the debt.
PENGU Yield
PENGU
Up to 1.8x
USDC Yield
USDC
Up to 3.9x
USDT Yield
USDT
Up to 3.9x
WETH Yield
WETH
Up to 4.0x
Net APY formula:
For example, at 3x leverage with 5% supply APY and 3% borrow APY:
Yield loop positions also earn Kona Points on both the supply and borrow side, which are multiplied by your leverage.
Opening a Position
Navigate to Lending → Leverage in the sidebar.
Select your asset and strategy (Yield Loop, Long, or Short) using the pair selector or the trade builder tabs.
Enter the amount you want to deposit.
Choose your leverage multiplier using the slider or quick-select buttons.
Review the quote: position size, estimated debt, health factor, liquidation price, net APY, and flash loan fee.
Click Review to see the full confirmation modal with all details.
Confirm the transaction in your wallet. The looper handles all approvals, flash loans, and swaps atomically.
What you'll see in the review modal
Margin — your initial deposit (in tokens and USD).
Leverage — the multiplier you selected.
Position Size — total collateral after looping (in tokens and USD).
Estimated Debt — how much you'll owe (in tokens and USD).
Liquidation Price — the asset price at which your position would be liquidated (N/A for yield loops).
Health Factor — a measure of position safety. Below 1.0 triggers liquidation.
Net APY / Total APY — your expected annualized return including Kona Points rewards.
Flash Loan Fee — a small one-time fee (0.09%) charged by the pool on the flash-loaned amount.
Slippage — maximum acceptable slippage for any swaps involved.
Managing Open Positions
Position Table
Your open positions appear below the trade builder with real-time data:
Pair — asset, direction badge (LONG / SHORT / YIELD), and time since opened.
Size — total collateral supplied (tokens + USD).
Entry / Now — the oracle price when you opened vs. current mark price.
Leverage — the leverage you selected when opening.
Liq. Price — price at which liquidation occurs, with "% away" distance indicator. Same-asset yield loops show N/A.
PnL — dollar profit/loss and percentage. Toggle to APY view to see net yield instead.
Health — per-position health factor with color coding (green > 1.5, yellow > 1.2, red < 1.2).
The summary bar at the top shows aggregate stats:
Net Value — total equity across all positions.
Collateral — total collateral supplied.
Global Leverage — overall portfolio leverage (total collateral / net value).
Global HF — your account-wide health factor from the Kona Lend pool (affects all positions).
Reducing Leverage (Adjust)
Click Adjust on any position to partially deleverage:
Drag the slider left to choose a lower target leverage.
The modal shows estimated changes: new collateral, debt, health factor, and how much debt will be repaid.
Click Reduce to execute. The looper withdraws collateral, repays debt, and adjusts your position in one transaction.
You can only reduce leverage through the Adjust modal. To increase leverage, open a new position with additional deposit.
Closing a Position
Click Close to fully unwind a position:
The looper redeems all collateral, repays all debt, and returns the remaining equity to your wallet.
For cross-asset positions (long/short), a swap occurs to convert collateral back to the repayment token.
Liquidation
Liquidation happens when your Health Factor drops below 1.0. This means the value of your collateral (weighted by the liquidation threshold) no longer covers your debt.
What affects your Health Factor
Collateral price drops (longs)
Health factor decreases
Debt asset price rises (shorts)
Health factor decreases
Accrued borrow interest
Slowly decreases health factor
Higher leverage
Lower starting health factor
Yield loops and liquidation
Yield loops (same-asset) have no liquidation price because the collateral and debt are the same token — price movements affect both sides equally. However, if the borrow rate exceeds the supply rate for an extended period, accrued interest can erode your health factor over time.
Shared account health
If you have multiple positions or other Kona Lend supply/borrow positions on the same wallet, they share a single health factor at the Kona Lend pool level. A liquidation on any position can affect all others. For safer leverage trading, consider using a dedicated wallet.
Fees
Flash loan premium
0.09% of flash-loaned amount
One-time, at open
Borrow interest
Variable (market-driven)
Ongoing, accrues over time
Swap slippage
Up to your tolerance (default 1.5%)
At open/close for cross-asset positions
Protocol fee
40-60 bps (lower for farm loops)
One-time, at open
Paper Trading
New to leverage? Switch to Paper Mode using the toggle in the top-right corner.
Start with $5,000 in virtual funds.
Open and close positions using real-time market data and oracle prices.
Track your PnL, open positions, and trade count.
Paper positions are saved locally and persist across sessions.
Switch to Real Mode anytime — paper positions stay separate.
Paper trading is a risk-free way to learn how leverage, liquidation, and yield loops work before committing real assets.
Contracts
KonaLooper (Proxy)
0x09A4518945C9cD484B5eac3FACf4A5B0bdd3A5bc
Abstract Mainnet
KonaLooper (Implementation)
0x39fb6d7B5566d2F844863F2AaE1C7C74896e0B31
Abstract Mainnet
Kona Swap Router
0x441E0627Db5173Da098De86b734d136b27925250
Abstract Mainnet
The KonaLooper is a non-custodial helper contract. It executes flash loan loops on behalf of the user but never holds funds — all collateral and debt positions are held directly in the Kona Lend pool under the user's address.
FAQ
Can I get liquidated on a yield loop? Not from price movements. Since collateral and debt are the same token, oracle price changes don't affect your health factor. However, if borrow rates stay significantly above supply rates for a long time, accrued interest can gradually reduce your health factor.
Why does my health factor show the same value for all positions? The "Global HF" in the summary bar is your account-wide health factor from the Kona Lend pool — it covers all positions together. Each position row shows its own per-position health factor based on that position's collateral and debt.
Can I increase leverage on an existing position? Not directly. To get more leverage, open a new position with additional deposit. The Adjust modal only supports reducing leverage.
What happens if I have positions on Kona Lend Markets and Leverage? They share the same Kona Lend pool account. Your global health factor reflects all supply and borrow activity. A warning banner will appear if external positions are detected.
What are Kona Points? Kona Points are reward emissions distributed to Kona Lend suppliers and borrowers. Leveraged positions earn points on both sides — supply points on your total collateral and borrow points on your debt — effectively multiplied by your leverage.
What's the flash loan fee? 0.09% of the flash-loaned amount, charged once when opening the position. This is the standard Kona Lend flash loan premium.
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