Vaults & Strategies
CoreVault
CoreVault is an ERC-4626 compatible vault that accepts a single deposit asset — USDC — and deploys it across multiple isolated lending strategies. Depositors receive fungible vault shares representing their proportional claim on the vault's total assets.
Key properties:
- Single asset. CoreVault accepts only USDC. This eliminates swap risk and simplifies NAV accounting.
- Multiple strategies. Capital is distributed across several lending protocols simultaneously, diversifying yield sources and reducing single-protocol exposure.
- NAV-based share pricing. The share price is calculated from the vault's net asset value: the sum of all deployed capital, accrued interest, and the liquid buffer, minus fees. There is no external market-making of vault shares.
Strategy Architecture
A strategy is an isolated adapter contract that deploys USDC into a specific external lending protocol. Each strategy:
- Holds its own position independently of other strategies
- Reports its current value back to the CoreVault for NAV calculation
- Can be paused, degraded, or recalled without affecting any other strategy
- Has no ability to withdraw funds from the CoreVault or from other strategies
Active Strategies
The current deployment on Arbitrum includes USDC lending strategies across:
| Protocol | Type | Status |
|---|---|---|
| Aave V3 | USDC lending | Active (shadow testing) |
| Euler | USDC lending | Active (shadow testing) |
| Morpho | USDC lending | Active (shadow testing) |
| Compound | USDC lending | Active (shadow testing) |
Seven lending adapters are deployed, with three additional strategies in development.
Strategy Lifecycle
Every strategy follows a strict governance-controlled lifecycle:
- Propose. A new strategy adapter is submitted for review. The proposal includes the target protocol, risk parameters, and allocation limits.
- Approve. The strategy passes through a timelock period, giving governance participants and the community time to review before activation.
- Activate. The strategy is registered with the StrategyRouter and becomes eligible to receive capital allocations.
- Monitor. The StrategyHealthRegistry continuously tracks the strategy's health — including utilization, yield performance, and protocol risk indicators.
- Degrade / Recall. If a strategy exhibits unhealthy behavior or its underlying protocol faces issues, it can be degraded (no new capital) or fully recalled (all capital withdrawn) without disrupting other strategies or the vault.
Risk Isolation
Risk isolation is a core design constraint, not an optional feature. Each strategy adapter is an independent contract with its own state. This means:
- A vulnerability in one external protocol does not expose capital deployed to other protocols
- A strategy can be emergency-paused in isolation — the CoreVault and all other strategies continue operating normally
- Strategy losses are contained: they affect NAV proportionally but cannot drain the vault or other strategies
- No strategy has the ability to call functions on the CoreVault outside of its defined interface
BufferManager
The BufferManager maintains a liquid reserve of USDC within the CoreVault. This reserve is not deployed to any strategy and serves two purposes:
- Instant withdrawals. Depositors can withdraw up to the buffer amount without waiting for capital to be recalled from strategies.
- Operational margin. The buffer provides headroom for gas-efficient rebalancing, avoiding the need to recall capital for routine withdrawal volume.
The buffer target is set as a percentage of total vault assets and is maintained automatically by the StrategyRouter during rebalancing operations.
Document version: 1.1 Last updated: 2026-03-29