A Guide to User Vaults: Shares and NAV, Subscription and Redemption Rules, and Manager Rules

1. What Is a User Vault?

A User Vault is a trading vault created and run by a manager. The manager trades with the vault's funds; you subscribe with USDC to receive shares, and the value of those shares rises and falls with the vault's profit and loss.

To open it, go to Vault > User Vault in the top navigation. You need to be logged in. Two tabs at the top of the page match the two roles:

A few ideas to get clear first:

• Shared pool: everyone's funds in a vault sit together and are traded by the manager as one pool. The manager's own seed funds are in there too and count toward the Manager Self-Holding.
• Shares and NAV: when you subscribe, your USDC is converted into shares at NAV, and the vault's profit and loss shows up in the NAV per share. The value of your holding = shares × NAV per share. When NAV rises, your shares are worth more; when it falls, they are worth less.
• Official NAV: only a published official NAV is used to execute subscriptions and redemptions. The initial NAV of 1.0000 per share is just a starting point for the calculation; it does not mean your principal is guaranteed.
• The manager has no withdrawal rights: the manager only trades and cannot move money out of the vault account.

2. Finding and Choosing a Vault

1. Log in and go to Vault > User Vault in the top navigation. You land on the Vault Market under the Subscriber tab.
2. Use the search box to find a vault, or sort by Highest AUM, Highest 30-Day Return or Highest NAV per Share.
3. Each vault has its own card. Click View Details to open its details page.

Here is what the cards and details pages show:

At the top of the details page you will find AUM, Annualized Return Over the Past 30 Days, My Investment and Cumulative Return. Below that are the NAV Trend chart (All, 30 Days or 60 Days) and Statistics, which include Min. Subscription, Max subscription, Performance Fee Rate and Cumulative Performance Fees Collected. Under My Vault Account, at the bottom of the Vault Market page, you can check My Holdings and your Subscription/Redemption Records.

How can you tell whether the manager's interests are aligned with investors? The page suggests checking the Manager Self-Holding ratio on the details page. If the manager's self-holding is too low, the vault may have subscriptions paused.

3. Subscribing: Turning USDC into Shares

Steps:

1. On the vault's details page, click Subscribe.
2. USDC is the only subscription asset; the page states, "This pool supports subscriptions in the stablecoin USDC only."
3. Enter the subscription amount. The amount field shows this vault's per-transaction limits, and the page estimates how many shares will be minted at the current NAV. The final amount is based on the official NAV.
4. Read and tick Risk & Disclosure Confirmation, then click Submit subscription.
5. Once it is submitted, the page shows the request number, the Indicative NAV, the Settlement Cutoff and the estimated shares to be minted.

Subscription rules:

Only vaults with the status Active accept subscriptions.

4. Redeeming: No Lock-Up, Paid on the Next Settlement Date

Steps:

1. On the vault's details page, click Redeem.
2. Enter the shares to redeem, no more than you hold. You can also click 25%, 50%, 75% or All to fill it in.
3. Go to the next step and check the total redeem amount (estimated at the current NAV) and the Percentage of Pool AUM.
4. Click Submit redemption. Once it is submitted, the page shows the request number, the Estimated Payout and the Settlement Cutoff.

Redemption rules:

• No lock-up: you can submit a redemption for the shares you hold at any time.
• Paid on the next settlement date: your shares are burned at the settlement NAV on the next settlement date, 00:00 UTC+8, and paid out in USDC. The amount you see when you submit is an estimate at the current NAV; the final execution uses the NAV at the next 00:00 UTC+8.
• Still in profit and loss until settlement: between submitting and settlement, those shares keep rising and falling with the vault, so the final payout can differ from the estimate.
• No platform redeem fee: the page states, "The platform's redeem fee is 0."
• Performance fee: the manager's performance fee is paid together with the payout.
• Large redemptions: if a redemption, estimated at the current NAV, comes to 10% or more of the pool's AUM, it goes through a liquidity review. The page tells you as you enter the shares.

5. Managers: Creating a Vault and Getting Paid

To become a manager yourself, switch to the Manager tab on the User Vault page and click Create Vault. Creation takes two steps:

1. Basic Information: enter the vault name, the Strategy & Risk Summary (strategy logic, key risks and who it is not suitable for), the subscription limits (minimum and maximum per subscription) and the performance fee.
2. Seed Threshold: transfer seed funds from your Spot account to the vault. The minimum is 10,000 USDC, and it cannot exceed your available Spot balance. The AUM cap is calculated automatically as Transfer Amount × 20 and cannot be edited.

Finally, tick Pre-creation Disclosure Confirmation and click Transfer to Create Vault. According to the page, the vault needs approval and seed funding before it can start operating.

Manager rules:

6. Risks to Think About Before You Subscribe

• Your principal is not guaranteed, and no fixed return is promised: the vault's NAV changes with strategy performance, market volatility and execution costs, so it can go up or down.
• Past returns do not indicate future returns: the Annualized Return Over the Past 30 Days and the NAV Trend are historical data and not a promise of returns.
• Results depend on the manager's trading: the manager trades the whole vault. Before you subscribe, read the Strategy & Risk Summary and check the Manager Self-Holding and the performance fee rate.
• Redemptions wait for settlement: a redemption is not paid out instantly, your shares keep moving with the vault until settlement, and large redemptions also go through a liquidity review.
• A vault's status can limit what you can do: when a vault shows Subscriptions paused, you cannot subscribe but can still redeem as long as it is not frozen; when it shows Frozen, subscriptions and redemptions are temporarily unavailable; once a vault is Closing, shares are paid out at the final NAV.
• You confirm the disclosure before subscribing: before you submit, you tick to confirm that you have read the pool's strategy, all risk parameters, fee rules, manager holding requirements and strategy change mechanism in full, and that you understand user vaults do not guarantee your principal or promise fixed returns.

Further Reading

• Earn Explained: Interest in the Coin You Deposit, Flexible and Fixed-Term Products, and How It Compares with User Vaults
• Account Structure and Fund Transfers: Moving Funds Between Spot and Perps, and Subscribing to Earn and User Vaults
• Fund Security and Proof of Reserves: On-Chain Verification, Hot and Cold Wallets and Negative Balance Protection

Risk Warning

User vaults do not guarantee your principal or promise fixed returns. A vault's NAV changes with the manager's strategy performance, market volatility and execution costs, and it can fall; historical figures such as the Annualized Return Over the Past 30 Days do not indicate future returns. Redemptions are paid at the settlement NAV on the next settlement date, your shares keep sharing in profit and loss until then, and large redemptions also go through a liquidity review. Only use funds you can afford to lose, and read the vault's strategy, fees and rules before you subscribe.

Disclaimer

This article is for general informational and educational purposes only and may not apply to the regulations or products available in your region. It does not constitute investment, financial, or trading advice of any kind, nor an offer, solicitation, or recommendation to buy, sell, or hold any digital asset.

Trading digital assets involves high risk, prices can be extremely volatile, and you may lose all of your invested capital. Leveraged trading can result in losses exceeding your initial deposit. Past performance is not indicative of, and does not guarantee, future results.

You should make investment decisions independently based on your own financial situation and risk tolerance, and consult a licensed professional adviser where necessary. While we strive to ensure the accuracy of the information in this article, MC Markets accepts no liability for any errors or omissions, or for any loss you may suffer from using or relying on this information.