The vault serves as a counterparty to a subset of trades made on the Everstrike platform.

In the first year of Everstrike being operational on the Mainnet, we expect the vault to serve as a counterparty for 80-90% of all trades on the platform. In subsequent years, as Everstrike grows and gets used by more people, we expect the vault dominance to drop to 20-30%, and eventually fade into zero. Once the vault is no longer central to Everstrike, a proposal to phase out the vault will be created, subject to approval by the Everstrike DAO. If the proposal passes, the vault will be phased out, distributing the funds that have accumulated within it to evUSD holders.

The vault directly influences the conversion price of Everstrike USD (evUSD).

evUSD will convert to USDT at a rate of

where Vault Balance is the cumulative profit recorded by the vault since inception and evUSD Supply is the circulating supply of evUSD.

Furthermore, rewards are distributed on the first of every month, among holders of evUSD, based on the following formula:

where Vault P/L is the profit or loss recorded by the vault during the previous calendar month, and Vault Distribution Rate is a constant determined by the Everstrike DAO.

The distribution follows a pro-rata principle, where each evUSD holder receives an amount proportional to the amount of evUSD held by the holder throughout the previous month.

The vault profit that is not distributed as rewards is added directly to the Vault Balance, increasing the balance over time, and keeping the evUSD USDT conversion rate stable.

Upon destruction, funds contained within the vault are distributed among evUSD holders automatically, based on a pro-rata formula that takes into account the amount of evUSD held by each holder throughout the previous 12 months.

50% of all protocol fees generated through the Everstrike platform are deposited directly into the vault, further contributing to the vault balance and boosting the APY enjoyed by evUSD holders.

What is the goal of the vault?

The goal of the vault is to bootstrap liquidity on the Everstrike Mainnet, and to democratize earnings from liquidity provisioning and market making on the platform.

Why is the vault needed?

Without the vault, users on the Everstrike Mainnet would suffer from inadequate liquidity during the first 1-2 years of Mainnet operations, and would not receive a share of market making and liquidity provisioning profits, unless engaging in those endeavours themselves.

Does the vault replace institutional market makers?

No. The vault is a complement to institutional market makers. Once Everstrike is widely adopted by institutional market makers, the vault can be phased out.

What happens if the vault balance goes negative?

If the vault balance goes negative, evUSD will temporarily lose its peg. The peg is restored once the vault balance becomes positive again.

How are vault earnings distributed?

Pro-rata among evUSD holders, based on the average amount of evUSD held by each holder throughout the previous calendar month.

The distribution happens at 00:00 UTC on the first of every month.

What do I need to do to receive distributions?

To be eligible for monthly vault distributions, you simply need to hold a balance of at least 0.01 evUSD. The distributions are credited to your balance automatically. There are no manual steps involved. You can acquire evUSD through Everstrike or through third party DEX's (coming soon).

How much of the vault profit is distributed?

The amount of profit that is distributed is governed by the Vault Distribution Rate, which is currently set to 30%. The Everstrike DAO is capable of modifying the Vault Distribution Rate and may elect to do so in the future.

Where can I track the balance of the vault and the Vault Distribution Rate?

On the official stats dashboard of Everstrike.