What is A Liquidity Vault

Vaults are a common feature in Web3 and DeFi, designed to simplify the user experience. But many existing vault providers underperform and offer limited exposure — often restricted to standard pairs like ETH-USD or pegged ETH variants.

Krystal’s Liquidity Vault is different. It’s a smart contract that functions as a dynamic portfolio manager. It holds and actively manages multiple LP assets, runs automated strategies, collects fees, adjusts positions, exits, and optionally vault can support external deposits in exchange for vault shares.

Core Capabilities:

• Manages multiple LP assets

• Auto collect and convert fees

• Enables auto-compounding, rebalancing, exiting, and more

• Auto-farm with enabled AI Agent

Why use a Vault?

• Fewer Transactions, Less Gas: Bundle multiple LP actions (e.g. migrate, rebalance) into fewer txs

• Safer and More Secure: Vault permissions are scoped to the Vault only—unlike LP Strategies/Positions, which require permission across the entire NFT asset

• Simplified UX: Great for both normies and experienced users

• Unlock More Opportunities: Go beyond basic ETH pairs. Tap into niche markets, long-tail tokens, and custom strategies to maximize your edge in DeFi.

• Passive Earning: Let others deposit into your Vault and take a cut from performance fees

Types of Liquidity Vault

There are 2 types of Liquidity Vault at Krystal:

• Auto-Farm Vault [coming soon]: Liquidity Farming through a Vault interface with enhanced management tools and AI Agent.

• Shared Vault: Allow public users to deposit into a vault; the vault owner takes a cut of the performance fee.