How it works

How It Works

Overview

VULTR is a USDC vault that aims to earn yield from DeFi liquidations on Solana. Users interact with a simple vault interface (deposit/withdraw), while a dedicated liquidation execution layer runs continuously in the background. Profits are returned to the vault, increasing the value per vault share over time.

Core Concepts

Vault USDC Pool

The vault is the pool of USDC that:

• Accepts user deposits

• Supports user withdrawals

• Serves as strategy capital for liquidation execution (under strict controls)

Vault Shares (Receipt Token)

When you deposit, you receive vault shares (sometimes referred to as sVLTR). Shares represent your proportional ownership of the vault.

• Deposit USDC → mint shares

• Withdraw USDC → burn shares

• When profit is added to the pool → each share becomes worth more USDC

Share Price (Value Per Share)

The vault’s “share price” rises as liquidation profits are realized and routed back into the pool. Your share count may stay constant, but the USDC value of your shares increases if the vault is profitable.

User Flow

1) Connect Wallet

1. Open app.vultrprotocol.com

2. Connect your Solana wallet

3. Confirm the app shows your USDC balance and vault status

What you see: deposit box, vault stats (TVL, share price), and your position (shares held).

2) Deposit USDC (Mint Shares)

1. Enter an amount of USDC to deposit

2. Approve the transaction in your wallet

3. After confirmation, you receive vault shares

What happens under the hood:

• USDC moves into the vault

• The vault mints shares to you based on the current share price

• Your position is now a claim on the pool

User outcome: you now hold shares, not a fixed APR promise.

3) Vault Operates (Liquidations Run)

Once deposits are in, you do not need to do anything.

The liquidation engine continuously:

• Monitors supported lending markets for liquidatable positions

• Validates profit after costs (slippage, routing, market impact)

• Applies guardrails (oracle freshness, circuit breakers, sizing rules)

• Executes liquidations when conditions are favorable

Key point: you are not trading; you are holding a pro-rata share of a pool that earns profit.

4) Profit Accrues (Share Price Increases)

When the system realizes profit:

• Profit is routed back into the vault pool

• The pool value increases

• The share supply typically does not increase due to profit events

• Therefore, value per share rises

User outcome: your shares become redeemable for more USDC than before.

5) Withdraw USDC (Burn Shares)

1. Choose an amount to withdraw (or select max)

2. The app calculates the share burn required at the current share price

3. Confirm the transaction

4. Receive USDC back to your wallet

What happens under the hood:

• Shares are burned from your wallet

• The vault transfers USDC to you at the current redemption rate

What Users Should Expect

What you control

• You keep custody via your wallet

• You can deposit/withdraw according to vault rules

• You can track your position value based on share price

What the protocol controls

• Execution logic, liquidation selection, and routing

• Risk limits and operational constraints

• When to execute and when to stand down (circuit breakers)

What is not guaranteed

• A fixed APR

• Constant profit (returns depend on market conditions, competition, liquidity, volatility)

Quick “At a Glance” Summary

• Deposit USDC → receive vault shares

• The system hunts liquidations using professional execution infrastructure

• Profit returns to the vault → share price increases

• Withdraw anytime by burning shares for USDC