Fees

Vault Management Fees

Vault managers can set up the following types of fees for their vaults:

1. Management Fee:

   • Continuous constant fee defined as an annualized % of the total value locked (TVL)

   • Calculated & charged during deposits / withdrawals or when the vault manager calls the function to charge the fees

2. Entry / Exit Fees:

   • Fixed fee defined as a % of deposit / withdrawal

   • Charged every time the user deposits or withdraws

3. Performance Fee:

   • Defined as a % of the difference between the asset's current price and its high watermark

   • Calculated & charged during deposits / withdrawals or when the vault manager calls the function to charge the fees

   • Important: performance fees can be charged only on realized gains, i.e., vault managers must "take profit" by converting their portfolio into WETH, Stablecoins or other major assets

All fees are charged in a form of vault tokens (index tokens) that are being minted according to the calculations.

Platform Fees

To support further development & future token buy-backs Velvet Capital DeFi execution engine takes a 0.2% transaction fee. The fee can be further reduced by staking Velvet tokens (please refer to the Tokenomics section).