Tech Talk: Kinetic

In a landmark moment for Solana DeFi, Kinetic has unveiled and immediately deployed SUPA (Solana Uniform Price Auction), a novel market structure that could fundamentally change how trading works on blockchain networks. The protocol, which went live during the Breakpoint 2025 presentation, introduces frequent batch auctions to Solana—a mechanism borrowed from traditional finance that promises to eliminate the costly sandwich attacks that have plagued crypto traders.

Summary

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Grant Stenger, founder and CEO of Kinetic, took the stage at Breakpoint 2025 to announce what represents the deepest vertical expansion yet for the trading platform that began its Solana journey in 2021. SUPA reimagines blockchain's discrete time nature—often viewed as a limitation—as a powerful feature that enables fair pricing for all market participants.

The protocol works by collecting trading intents over a specified auction period, then settling all trades at a single uniform price. This approach directly counters the sandwich attack problem where malicious actors exploit the transaction ordering in traditional AMMs to profit at the expense of regular traders. By ensuring everyone in an auction period receives the same price, there's simply no economic incentive for sandwiching.

Kinetic's journey from NFT trading infrastructure to this sophisticated market structure innovation showcases the rapid evolution possible in the Solana ecosystem. The company has grown from NFT aggregation into DEX aggregation, recently announcing a major integration with Titan, and now offers a complete vertical trading stack serving a community of approximately 10,000 members across Discord, X, and Telegram.

What makes this launch particularly significant is its immediate availability. Unlike many protocol announcements that come with lengthy roadmaps, SUPA deployed live during the presentation itself, allowing traders to experiment with the new market structure immediately on kinetic.xyz.

Key Points:

The Problem with Traditional DEX Trading

Current decentralized exchange designs on blockchains operate in a way that creates opportunities for sophisticated traders to extract value from regular users. The most notorious of these is the sandwich attack, where a malicious actor observes a pending trade, executes a buy just before it to move the price, then sells immediately after the victim's trade completes at a profit. This extraction mechanism costs traders millions of dollars annually across DeFi.

Traditional finance has long grappled with similar issues, spending enormous resources on latency optimization—including famously beaming trading signals through the Earth's core to gain microsecond advantages. However, financial researchers have noted that economically meaningful information rarely emerges faster than roughly 100 milliseconds, suggesting much of this speed competition is wasteful.

How SUPA Works

SUPA begins with a foundation similar to constant product market makers (like Uniswap's model) but overlays a batch auction mechanism on top. Pool creators can specify different auction durations—from a single Solana slot (400 milliseconds) up to once per minute, hour, or even daily like traditional equity closing auctions.

During each auction period, traders submit their orders as intents. At the auction's conclusion, all orders are netted out at a single uniform price. This means whether you're a whale moving millions or a retail trader with a small position, everyone in that auction period gets the exact same execution price. The discrete time nature of blockchains, often criticized compared to continuous traditional markets, becomes the enabling feature rather than a bug.

Benefits for Traders and Liquidity Providers

For traders, the primary benefit is protection from transaction-specific sandwiching. In Stenger's example, if Alice wants to place a million-dollar Solana buy and "nefarious Bob" wants to sandwich her, Bob loses his economic incentive entirely. Since everyone settles at the same price, there's no profit to capture from ordering manipulation.

Liquidity providers also stand to gain from this architecture. The whitepaper details mechanisms where auctions run immediately before batch closings can direct profits to LPs, serving as what Stenger described as a "LVR lever reducing mechanism"—meaning LPs lose less money to arbitrageurs compared to traditional AMM designs. This could significantly improve the economics of providing liquidity on Solana.

Kinetic's Full Vertical Stack

SUPA represents the deepest layer of Kinetic's vertically integrated trading platform. The stack begins with community at the top—the "beating heart" of the operation—followed by their user interface offering mobile and desktop experiences. Features include a discover page with screening and filtering tools, a "trench trading" interface, pool and token analytics, wallet tracking, portfolio management, a points program, and trading competitions.

Below the UI sits their DEX aggregator, which has become a core pillar of the business. This aggregator routes trades across various Solana DEXs to find optimal execution and is actively integrating with meta-aggregators, wallets, and trading terminals. The company is also recruiting both new prop AMMs and established DEXs for integration.

Traditional Finance Inspiration

The concept of frequent batch auctions isn't new—it's been extensively studied in traditional finance literature. Opening and closing auctions in equity markets function similarly, where all participants submit orders that are then matched at a single clearing price. What's novel is bringing this proven mechanism to blockchain environments.

Stenger suggested that traditional finance has struggled to innovate on market structure due to regulatory capture and institutional inertia. Solana, with its high throughput and discrete block structure, presents an ideal environment to test and deploy these alternative market designs without the same barriers to innovation.

Facts + Figures

• SUPA protocol launched live during the Breakpoint 2025 presentation and is immediately accessible on kinetic.xyz
• Kinetic has built a community of approximately 10,000 members across Discord, X, and Telegram
• The company began building on Solana in 2021, starting with NFT trading infrastructure
• A single Solana slot is approximately 400 milliseconds, representing the minimum possible auction duration
• Kinetic recently announced a major integration with Titan for their DEX aggregation services
• The full technical whitepaper is available at kinetic.xyz/whitepaper
• Grant Stenger's background includes work at Polychain and Jane Street
• The protocol prevents what the team calls "transaction-specific sandwiching"
• Pool creators can customize auction durations from single slots to daily intervals
• Traditional HFT infrastructure spends hundreds of millions on microsecond-level latency improvements

Top quotes

• "What if for a moment we considered what we used to consider as a blemish of the crypto ecosystem, this sort of discrete time nature of blockchains, if we considered it just for a moment to be a valuable asset."

• "There's no real economically valuable information that happens faster than call it a hundred milliseconds or a second or something like that."

• "Bob is no longer economically incentivized to place this trade anymore. And so this auction structure prevents transaction specific sandwiching in a very positive way."

• "Solana, I think it's the perfect place to introduce frequent batch auctions."

• "Our mission is very well parallelized with the rest of the Solana ecosystem. We're really here to accelerate internet capital markets on Solana."

• "The community is really sort of the beating heart of Kinetic and is what the rest of the stack is all kind of building towards."

• "This is a very rich design space and one that we are pursuing very deeply."

Questions Answered

What is a sandwich attack and why should traders care?

A sandwich attack occurs when a malicious actor monitors pending transactions on a blockchain and strategically places trades before and after a victim's trade to profit from the price movement they cause. For example, if someone submits a large buy order, an attacker will buy first (pushing the price up), let the victim's trade execute at the worse price, then immediately sell at the elevated price. This costs regular DeFi users significant money on every trade and represents a major problem in current DEX designs. SUPA eliminates this attack vector by settling all trades in an auction period at a single uniform price.

How does SUPA's batch auction mechanism actually work?

SUPA collects trading intents over a specified auction period—which can range from a single Solana slot (400 milliseconds) to daily intervals like traditional equity markets. During this period, traders submit their orders without immediate execution. At the end of the auction, all orders are processed together and everyone receives the same clearing price. This is similar to how opening and closing auctions work in stock markets, but repeated continuously. Pool creators can specify their preferred auction duration when setting up liquidity pools.

Why is Solana particularly suited for frequent batch auctions?

Blockchains naturally operate in discrete time intervals (blocks/slots) rather than the continuous time of traditional markets. While this has often been viewed as a weakness, SUPA leverages this characteristic as a feature. Solana's fast block times (approximately 400 milliseconds) enable high-frequency auctions while its high throughput can handle the order matching requirements. Additionally, blockchain's permissionless nature allows for experimentation with market structures that would face regulatory obstacles in traditional finance.

What benefits do liquidity providers receive from SUPA?

Liquidity providers on traditional AMMs often lose money to arbitrageurs who exploit price discrepancies—a phenomenon measured by "Loss Versus Rebalancing" (LVR). SUPA includes mechanisms where auctions run immediately before batch closings can direct some profits back to LPs, reducing these losses. The whitepaper provides detailed technical specifications on how this LVR-reducing mechanism functions, potentially making liquidity provision more economically attractive on Solana.

What is Kinetic's broader product ecosystem beyond SUPA?

Kinetic operates a full vertical trading stack on Solana. At the top sits their community of roughly 10,000 members. The UI layer offers mobile and desktop trading experiences with features including token discovery and screening, analytics dashboards, wallet tracking, portfolio management, and trading competitions. Below this is their DEX aggregator that routes trades across multiple Solana DEXs for optimal execution—recently integrated with Titan and seeking additional partnerships. SUPA represents the deepest infrastructure layer, providing the underlying market structure for trading.

How can developers and protocols integrate with Kinetic?

Kinetic actively seeks integrations across multiple levels. Meta-aggregators, wallets, and trading terminals can integrate their DEX aggregation APIs to provide users with tighter spreads. Underlying DEXs—whether established protocols or new prop AMMs—can integrate to gain access to Kinetic's order flow. For technical details about the SUPA protocol specifically, the whitepaper at kinetic.xyz/whitepaper provides comprehensive specifications for potential integrators.