PrimeUSD
PrimeUSD is a permissioned, yield-bearing vault token issued by Vault Street. It is designed for institutional participants seeking on-chain exposure to a leveraged short-duration investment grade fixed income strategy, with daily NAV accrual, and a permissioned circulation model with KYB-gated deposits, transfers, and withdrawals.
Strategy Description
The primeUSD vault pursues a leveraged carry strategy.
The vault deploys USDC into a collateral basket of tokenised investment grade fixed income assets — including T-Bill money market funds and AAA-rated CLO funds — uses those positions as collateral to borrow at competitive DeFi market rates, and deploys the proceeds back into the same collateral basket, building a leveraged position where the return on assets exceeds the cost of borrowing.
Key Parameters
Denomination
USDC
Protocol Fee
0.50% p.a. on TVL, no performance fee
Target leverage
Up to 8x
Express withdrawal
≤24h for up to 10% of TVL in aggregate
Standard withdrawal
5BD execution window
NAV update
Weekly reconciliation, daily on-chain propagation
Transfer model
Permissioned — whitelisted addresses only
Risks
Interest rate risk
The yield you receive depends on the spread between what the Vault earns (returns on investment grade fixed income assets) and DeFi borrowing rates (what it pays). These move independently. If borrowing costs rise or collateral yields fall, the net yield compresses — and can turn negative, eroding your deposit.
Stablecoin de-peg risk
The Vault borrows stablecoins that are designed to maintain a 1:1 USD peg but may deviate. Even small deviations affect the Vault's effective cost of borrowing and net return. The Vault’s Stability Buffer is designed to smooth short-term fluctuations but does not guarantee stable distributions.
Credit risk
Part of assets are ultimately allocated into structured credit instruments, such as collateralized loan obligations rated AAA by major credit rating agencies. Unlike T-Bills, these are corporate credit rather than government debt. In credit stress, or market liquidity shortage environment, their market value can fall, reducing collateral value.
Leverage and liquidation risk
The Vault uses up to 10x leverage. Leverage amplifies both gains and losses. If collateral values fall — due to de-peg events, rate moves, credit spread widening, or protocol parameter changes — positions may be force-liquidated at market prices, potentially resulting in a loss of principal.
Fund wrapper risk
Collateral is held as tokenised interests in underlying funds (T-Bill money market funds and investment grade fixed income funds). If an underlying fund imposes redemption gates or suspends withdrawals, those positions may become temporarily illiquid, which could delay or reduce your redemption.
Protocol risk
DeFi lending protocols can change their risk parameters — loan-to-value limits, collateral eligibility, liquidation thresholds — without notice. Such changes may force rapid deleveraging at unfavourable prices.
No guaranteed return
The Vault does not guarantee any yield, and past performance is not indicative of future results. You may receive less than you deposited, up to a total loss.
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