When a user allocates funds to a vault, they are issued vault shares corresponding to the increase in Net Asset Value that they contribute to the vault. The following sequence of actions takes place:

  1. User initiates a deposit. This is expressed in USDC

  2. The vault calculates the Net Asset Value: NAV = SUM(asset_i * price_i)

  3. Your vault share % is calculated: Share = Deposit/(Deposit+NAV)

  4. New vault shares are issued to the depositor s.t.:

Share=NewlyIssued/(NewlyIssued+Outstanding)Share = NewlyIssued/(NewlyIssued + Outstanding)

so that the amount of newly issued shares:

NewlyIssued=Shareβˆ—Outstanding/(1βˆ’Share)NewlyIssued = Share*Outstanding/(1-Share)

As a depositor, I get the amount of vault shares corresponding to the USDC value of my deposit, relative to dollar amount of vault Net Asset Value


  1. Bob wants to deposit 100 USDC into a vault of their choice

  2. The vault currently has a Net Asset value of 1000 USDC

  3. Bob’s share would be: Share = 100/(100+1000) = 0,0909 or 9,09%

  4. Suppose that the vault had 500 shares outstanding. This would mean that:

NewlyIssued = 0,0909*500/(1-0,0909) = 49,99 which is the number of new vault shares issued to Bob

Last updated