# How It Works #### Overview The Trade Float Vault operates as a pooled treasury vault with explicit rules governing how capital is deposited, deployed, accrues returns, and is redeemed. All capital movements are executed according to predefined parameters, with on-chain accounting and transparent reporting. Each Trade Float Vault: * Holds assets on-chain in segregated smart contracts * Is transparent and auditable, with real-time visibility into balances and flows * Operates under explicit, published risk parameters * Mints a receipt token to depositors representing their proportional interest in the vault #### 1. Depositing Capital Approved users deposit supported stablecoins into the Trade Float Vault. Deposits are accepted only from approved wallets and are subject to vault-level eligibility and permissioning rules. Once deposited, capital becomes part of a pooled vault balance and is available for deployment according to the vault’s risk and liquidity parameters. #### 2. Receipt Tokens Upon deposit, users receive a **receipt token** representing their proportional claim on the vault’s assets. Receipt tokens include: * **loUSD** for USDC deposits * **loEUR** for EURC deposits * **loGBP** for GBP stablecoin deposits (future) These tokens: * Represent ownership of a share of vault assets * Do not rebase * Are transferable subject to vault rules * Reflect accrued yield through changes in token value over time The receipt token functions as an accounting and ownership instrument rather than a speculative or governance asset. #### 3. Capital Deployment Capital in the vault is deployed into eligible, short-duration trade-linked exposures. Deployment is governed by: * predefined asset eligibility criteria * concentration limits * duration constraints * credit oversight processes Capital may be allocated across multiple trade exposures simultaneously, with portfolio composition managed at the vault level. All deployments are intended to align with the liquidity profile and risk parameters of the vault. #### 4. Yield Accrual Returns generated from trade and settlement activity flow back into the vault. Yield accrues at the vault level and is reflected through an increase in the net asset value of the vault over time. Receipt token balances remain constant, while the value represented by each token increases as returns are realised. There are no incentive emissions, rebasing mechanics, or synthetic reward structures. #### 5. Redemption The Trade Float Vault operates with defined liquidity terms designed to align with underlying trade finance timelines. Key features include: * **a minimum holding period of 30 days** * redemption windows governed by the duration of underlying exposures * orderly withdrawal processes to avoid forced asset liquidation Redemptions are processed at par value, subject to vault rules and available liquidity. #### 6. Fees The Trade Float Vault applies a transparent fee structure. This includes: * a management fee for operating and administering the vault * a performance fee applied only where genuine outperformance is achieved Fees are designed to align incentives between operators and capital providers. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://agridex-2.gitbook.io/agridex-docs/product/how-it-works.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.