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Core Concepts

Octant Funding Vaults​

Octant Funding Vaults are smart contracts that interact with DeFi strategies to direct generated yield to fund ecosystem growth or other goals.

They act as capital-preserving systems while helping you fund initiatives your community values most. Through the integration of yield-generation strategies, Funding Vaults are designed to generate value streams for funding while the underlying treasury assets are maintained long-term. These vaults keep your capital intact, rebalance yield opportunities, and route capital to funding recipients.

Capital providers can easily deploy their treasury assets, as the vaults manage the complexities of yield generation while ensuring sustainable funding streams for their ecosystems.

Multi-user Funding Vaults (Collective Funding Vaults)​

Octant's smart contracts features various features that can be configured to cater to different asset characteristics and funding needs. These include Yield Donating Funding Vaults designed specifically for non-rebasing tokens⁠, Yield Skimming Funding Vaults optimized for rebasing tokens that naturally appreciate over time, Multistrategy Funding Vaults that support multiple yield strategies with voluntary lockup periods and multiuser funding capabilities, enabling broader participation in ecosystem funding.

Each vault type employs specialized mechanisms to efficiently capture and distribute yield while maintaining the security of the principal capital deployment.

"Dragon" Vaults (SAFE Funding Vaults)​

A special type referred to as "Dragon" Vault offers seamless integration with Safe multisig wallets, built for organizations with large treasuries. By design, these vaults let Safe owners keep full control of their assets while the assets are used to engage in DeFi yield generation. Using yield-generation strategies, the vaults enable the deployment of various tokens directly from Safe wallets. The yield generated through different DeFi protocols is then automatically channeled into ecosystem funding initiatives, while protective mechanisms ensure the preservation of principal capital.

Yield Contribution Types​

All vault types function as efficient funding reservoirs within the Octant ecosystem. Dragon Vaults can be used by institutional treasury managers through their Safe integration. Meanwhile, other Funding Vaults democratize access to funding, allowing community members to contribute to sustainable growth while keeping their capital untouched. This type of yield contribution is known as Regenerative Funding Contribution.

Regenerative Funding Contribution​

Regenerative Contribution is a model where users deploy new Octant Funding Vaults and select yield-generating DeFi strategies to create sustainable revenue streams.

These vaults also accept yield-bearing assets like aDAI, stETH, etc. When yield-bearing tokens enter Octant Funding Vaults, the smart contracts automatically redirect the accruing value streams to the vault's routing mechanism, creating protocol-level composability without intermediation.

Direct Funding Contribution​

Capital providers can also contribute the yield without directly deploying productive assets or liquid tokens into the Funding Vaults.

In the Direct Contribution model, funds stay in the user's Safe wallet. Users can set up weekly or monthly allowances that authorize Octant smart contracts to withdraw the pre-set amounts pursuant to the user's determination.

The wallet handles yield generation independently, while the user-controlled Octant allocation mechanisms receive only the authorized contributions.

Community Staking​

Community members (i.e. Community Stakers) can stake ecosystem tokens into a contract that allows them to participate in the capital allocation process while simultaneously earning rewards.

Yield Allocation from a Dragon Vault

A Dragon (Safe multisign owners) can choose to stream a portion of the yield generated by the DeFi strategies into the Community Staking contract. This mechanism rewards active community members. Primarily, they can donate those rewards to fund projects within their own ecosystem or the broader Ethereum ecosystem. Alternatively, the rewards can also be withdrawn.

Splitting & Routing Layer​

Payments Splitter​

The Payment Splitter is a core component of Octant that facilitates the proportional distribution of funds generated by the yield strategies selected by the user. It receives ERC-4626 shares and allocates them to multiple predefined recipients, Community Staking contracts, Allocation Mechanism contracts, operational expense addresses, and other ecosystem initiatives.

By using a pull payment model, payees must actively claim their allocated share, ensuring transparency and control over fund distribution. This mechanism simplifies the process of routing yield to various funding destinations.

Allocation Mechanisms​

Allocation mechanisms are smart contracts designed to manage the distribution of funds received from yield-generating strategies or direct contributions. These contracts enable efficient and transparent allocation by assigning predefined weights to registered recipients, determining how the deployed funds will be distributed. They support various democratic resource distribution models, such as token-weighted voting or quadratic funding and voting rounds, allowing community members to actively participate in deciding how earmarked funds are allocated. These mechanisms ensure that resources are directed toward impactful initiatives based on community preference aggregation, fostering sustainable growth.