What is Katana ?

Among the Solana protocols, Katana is the premier tool for structured products and vault strategies. With Katana, you can use DeFi strategies to generate yield on Solana. Katana identifies, compiles, and packages an accessible set of yield strategies into accessible yield products. In the protocol, users can access a wide range of products across the risk spectrum, allowing them to mix and match strategies easily to create their desired exposure. The ultimate intent of Katana is to become a permissionless protocol that allows anyone with the Solana ecosystem’s best yield products to access, contribute, and build upon them.

According to the above tweet, the LUNA covered call options (Covered Call) vault launched the Solana ecological DeFi protocol Katana on December 24. Through the Wormhole cross-chain protocol, users can pledge LUNA for a 20% return.

wLUNA Covered Call

With wLUNA Covered Call, you generate yield by implementing an automated covered call strategy. Using the strategy described below, the vault accepts WLUNA deposits and generates yield using an automated covered call strategy. The strategy involves depositing WLUNAs on Zeta and issuing out-of-the-money WLUNA calls in return. In addition to earning the option premium as initial yield, the vault sells these call options, generating the full value of the options. If the price of WLUNA is below the strike price at the expiration date, the vault earns the full value of the option premium and repeats the strategy, compounding WLUNA over time.

There is a risk in this as, If the strike price of the call options at expiration is greater than the price of WLUNA, then the vault may incur a loss. Options deemed to have expired in the money can be exercised for WLUNA locked in the vault, resulting in a possible loss when the option is exercised. Strike prices are chosen to ensure that these outcomes are extremely unlikely.

Here we are discussing about the Katana’s Wormhole LUNA covered call vault . Katana’s primary service is a suite of accessible vaults offering automated yield strategies that execute in the background. One of these vaults is its Wormhole LUNA covered call vault, which offers good yield opportunities, particularly when the market is volatile. In the withdrawal process, shares represent your ownership of a Katana wallet, and they are necessary to retrieve funds from the vault.

The following graphs show how many Katana Wluna Covered Call Vault shares have been claimed since February 4th, and the number of unique wallets that have claimed shares. February 4, 2022 was the day when the maximum number of Unique Wallets was observed, and February 8, 2022 was the day when the minimum number of Unique Wallets was observed. Unique Wallets decreased by 71% from February 4, 2022 to February 19, 2022. Unique Wallets display a decreasing trend.

Katana Wluna Tokens reached a maximum of $973.64K on February 4, 2022, and a minimum amount of $330.07 was observed on February 13, 2022. Between February 4, 2022 and February 19, 2022, the total amount of Katana wLUNA Token decreased by more than 95%. It appears that the amount of Katana Wluna Tokens is decreasing

According to Katana wLUNA token distribution by wallet category, we created this graph. Over three quarters (76.52%) of the total Katana wLUNA Tokens came from the top two categories(‘More Than 100K Shares’ and ’10k to 50K Shares’ ). Katana wLUNA tokens have the highest total amount (more than 100K shares) at $977.53K. And also the maximum amount of Katana wLUNA token of $973.64K was observed in February 4, 2022 . This means that the whale wallets will only be visible on Feb 4,2022 and Feb 18,2022.In comparison with the other categories, the percentage of total Katana wLUNA tokens from this category is more than 60%.

Observations

From the above analysis,

• Although we only saw two days of whale shares, Feb 4,2022 and Feb 18,2022, almost 60% of the katana wLUNA tokens came from these two days. The rest of the categories follow 25% except the 10k to 50k Shares category. Therefore, the Katana wLUNA vault is primarily used by whales on the basis of amount.
• According to the unique wallets that have claim shares from Katana wLUNA , there are only a few whales on February 4, 2022, and February 18, 2022, however on other days there are other wallets than whale wallets. Therefore, the Katana wLUNA vault is not mainly used by whales on the basis of unique wallets.