Vault Architecture
Overview
HYYY's vault system starts with a Gateway Vault that serves as the entry point for users to convert their USDC into USDhy at a 1:1 ratio. From there, users can stake their USDhy into various strategy vaults, each offering different yield-bearing tokens and risk-reward profiles.
Key Features
- Gateway Conversion: Simple 1:1 conversion of USDC to USDhy
- Strategy-Specific Staking: Each vault issues its own yield-bearing token
- Capital Isolation: Each vault operates as an independent capital pool
- Risk Containment: Issues in one vault cannot affect others
Vault Types
HYYY's architecture consists of a Gateway Vault and multiple strategy vaults, each designed to implement specific strategies with varying risk-reward profiles:
Gateway Vault
- Entry point for users to convert USDC to USDhy
- 1:1 conversion ratio
- 24-hour processing window for redemptions
Strategy Vaults Examples
1. Conservative Vault (stUSDhyy-C)
- Lower risk tolerance
- Focus on market-neutral strategies
- Higher collateralization ratios
- Emphasis on capital preservation
- Real-world Example: Spot-Future strategy on BTC and ETH only, using 1x leverage on futures side delivering ~5-8% APY with minimal risk through established market pairs
2. Balanced Vault (stUSDhyy-B)
- Moderate risk exposure
- Mixed strategy approach
- Standard collateralization ratios
- Balance between yield and stability
- Real-world Example: Cross-venue funding rate arbitrage on top 10 market cap assets, using 3x leverage on both sides for ~15-30% APY
3. Aggressive Vault (stUSDhyy-A)
- Higher risk tolerance
- Complex multi-leg strategies
- Lower collateralization ratios
- Focus on yield maximization
- Real-world Example: Future-Future pairs with 5x leverage on emerging market pairs, potentially delivering 30%+ APY through higher funding rate opportunities
Yield-Bearing Tokens
Each strategy vault issues its own yield-bearing token when users stake their USDhy, and these tokens can:
- Automatically accrue yield based on vault performance
- Can be used as collateral in other DeFi protocols
- Represent ownership in the respective strategy
- Have different APY targets based on risk profile
Custom Vaults
Position managers can create new vaults with customized parameters based on:
- Market pairs selection
- Leverage levels
- Strategy combinations
- Risk tolerance
- Capital allocation rules
Each vault's performance and risk metrics are independently tracked and managed, ensuring complete isolation between different strategies.
Integration with Position Managers
Position managers interact with vaults through a standardized interface while maintaining strategy-specific parameters:
- Access Control: Managers are restricted to their assigned vaults
- Strategy Boundaries: Pre-defined limits and constraints
- Performance Monitoring: Vault-specific metrics and KPIs
- Risk Reporting: Segregated risk assessment and reporting