âī¸Vaults logic
How does it work?
Last updated
How does it work?
Last updated
The adrJLP and adrUSDC vaults are complementary. At a high level, the two Vaults work together by doing the following:
Users can deposit JLP into the JLP Vault, and USDC into the USDC Vault.
The JLP Vault borrows USDC collateral from the USDC Vault to mint more JLP, thereby gaining leverage on its JLP position.
The JLP Vault delivers amplified and transparent real yield to depositors.
The USDC Vault delivers USDC yield to depositors by receiving a portion of the yield from the JLP strategy built on its collateral.
The protocol doesn't use the principal provided (JLP) to pay USDC yield; rather, it only uses leveraged profit to distribute yield.
The JLP Vault solely borrows from the USDC vault and does not engage with other leverage sources. It aims to maintain exposure similar to the broad crypto market, including assets like SOL, ETH, BTC, while earning multiples of the base JLP yield.
USDC vault provides leverage to JLP vault, resulting in a consistent and transparent USDC yield for depositors. Technically, USDC vault has no gamma exposure and is free from dynamic hedging costs.
Vaults automatically rebalance to keep leverage and risk within defined ranges. This means that even in times of high market volatility, liquidity will be adjusted to maintain a stable level of leverage and risk.