Vaults are smart contracts that employ a specific set of strategies for easy yield farming. They make use of automation to continually invest and reinvest deposited funds, which help to achieve high levels of compounded interest.
Each vault can either refer to a pair of tokens invested in liquidity pools within the Binance Smart Chain ecosystem or a single token invested in lending platforms. After investing their tokens, the user is supplied with tokens that represent their stake.
Anyone in the community can work together to build new strategies and submit them to governance for voting.
Simply put, vaults can:
Use any asset as liquidity.
Provide one asset as collateral for another.
Manage collateral at a safe level to mitigate default.
Put any asset to work generating a yield.
Reinvest earned profits.
After profits are taken into account at the time of withdrawal, the vault will take up to 20% of the profits and distribute it as follows among Polis Drachma holders, the strategy developer, burned coins, and the charity and insurance addresses.
For some future vaults, a non-insured version might be offered, increasing the user profit to 85%
Funds for insurance and charity will be held in separate multi-signature addresses controlled by the developer team, and funds will only be released shall a hack happen either on the Polis Vaults service or any of the underlying investing strategies, or when a Community Proposal votes to assign resources to a charity organization.
Funds are stored in Polis, which means that the 5% insurance fee will be used to purchase Polis on PancakeSwap using the original asset.
The team will update the protocol so that funds meant for both insurance and charity are never in the hands of the developers of the vaults and the community is able to assign them through the governance. This is expected to arrive in Q4 2021.
All Vaults have a fee percentage assigned to the developer's discretion, this allows to continue updating and optimizing investing strategies, as well as creating new ones. This fee also helps developers take care of the auto compound function, as there is a BNB cost to claim rewards for all users. Funds allocated to this address will be spent at the owner's (developer team) discretion.
3% of Profits will be used to purchase Polis from Pancake Swap pools and burn them at 0xdeAD00000000000000000000000000000000dEAd.