Vaults

Through the ERC-4626 standard, Adapter has created one of the most flexible and functional protocols seen to date. This allows us to quickly build upon the most exciting DeFi protocols, while delivering best in class yields to our users. In addition to the standard ERC-4626 functionalities, the vaults are customized to use a strategy based on registered adapters for deploying assets that are available in the vaults. An adapter represents the integration to other projects like Pendle, Aave or Compound. This lightweight framework means that we can focus on the automation and optimization of top tier vaults, without requiring additional developmental resources. Modular integration allows our partners to focus on the building and improvement of their core product, while Adapter focuses on automation/optimization and the UX.

Figure 1 below shows the high-level architecture of an Adapter vault. Once a user deposits a token into the ERC-4626 vault, they receive shares that represent their ownership. The currently active strategy is used within the funds-allocator smart contract, to deploy tokens through the registered adapter into different markets.

Figure 1: High level functionality of an Adapter vault having 3 register Adapters. The example vault is generating yield by allocating 15% of tokens to market A, 30% to market B, and 55% to market C. All of which is managed on behalf of the user.