Sonnar - the risk engine

Sonnar is Hobba’s risk engine: an automated operator that watches every position around the clock and keeps it both safe and productive. It is the reason a Hobba loan needs no babysitting - you never manually rebalance, never chase vault APYs, and never claim yield by hand.

This page describes what Sonnar does at a high level; the on-chain methods it uses are summarized in Operator methods.

The control loop

Sonnar polls every open position on a short interval (roughly every 30 seconds) and, for each one, compares the live LTV against a per-asset target LTV with a tolerance band (deadband) around it:

                     target (~60-65%)
   ─────────────────────────┳─────────────────────────▶  LTV
         below band     ┃ in band ┃     above band
        borrow more     ┃  do     ┃     repay down
      (deploy to vault) ┃ nothing ┃  (pull from vault)

• Below the band → Sonnar borrows more USDC against the collateral and deposits it into the current yield vault, activating idle borrowing power.
• Inside the band → nothing happens. The deadband (±3%) stops the engine from churning on every small price tick.
• Above the band → Sonnar withdraws from the vault and repays debt, pulling the position back toward target.

The target sits per asset at roughly 60% for SOL and 65% for cbBTC - comfortably below the lenders’ liquidation LTVs (75-90% depending on lender and asset) - so the activated capital never encroaches on your safety margin.

Beyond rebalancing

Keeping LTV in band is only half the job. Sonnar also:

• Chases the best vault. It tracks the supply APY of every approved vault (Allez, Prime, RockawayRWA, Perena) and moves a position’s working capital when another vault beats the current one by a meaningful threshold.
• Harvests profits. Roughly every hour it checks each position for vault profit - earnings above what was deposited - and realizes it: the profit first repays your debt, and anything left over is sent straight to your wallet. This is the mechanism that makes effective APY negative.
• Unwinds unprofitable positions. If borrow rates rise above vault yield, deploying capital would lose money - so Sonnar withdraws the entire working borrow and repays it, leaving just your own loan until the spread returns.
• Claims incentives. Vault reward tokens (e.g. KMNO farm rewards) are claimed as part of the engine’s routine upkeep.

What Sonnar can and cannot do

Sonnar transacts through operator-only methods on the Hobba program, and the program enforces the boundary - it isn’t a matter of policy:

It can:

• borrow against your collateral into an approved vault,
• withdraw from the vault to repay your debt,
• move working capital between approved vaults,
• harvest profit - applied to your debt, remainder to your wallet.

It cannot:

• withdraw your collateral,
• close your position,
• send funds to any destination other than the lender, the approved vaults, or your own wallet.

Every position tracks the working borrow (deposited to vault) separately from your loan as a cost basis, so “what you owe” always means your debt - the engine’s working capital nets out of it.

You remain fully in control throughout: deposit, borrow, repay and withdraw work at any time, independent of what Sonnar is doing - a withdrawal simply unwinds the engine’s vault shares first, automatically.