> For the complete documentation index, see [llms.txt](https://references.everstrike.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://references.everstrike.io/trading/perpetual-vault.md).

# Perpetual Vault

The Everstrike Perpetual Vault acts as counterparty to a subset of Everstrike Mainnet trades. Its value changes with those trades, protocol fees, and reward distributions.

* When traders profit against the vault, the vault pays their profits.
* When traders lose against the vault, their losses are credited to the vault.

Everstrike expects the vault to counterparty 80–90% of trades during Mainnet's first year. This share may decrease to 20–30% as external market-making activity grows. These are operating estimates, not commitments.

The Everstrike DAO may approve a proposal to phase out the vault. If approved, accumulated vault funds are distributed to [evUSD](/account/evusd.md) holders using the 12-month pro-rata formula.

### Risks

Vault losses can reduce the `evUSD` conversion rate. A negative Vault Balance temporarily causes `evUSD` to trade below its USDC peg.

Rewards depend on the prior month's Vault P/L. They can be zero. The DAO can also change the Vault Distribution Rate.

### evUSD conversion

The vault influences the conversion price of [Everstrike USD (evUSD)](/account/evusd.md).

`evUSD to USDC Conversion Rate = 1 + min(0, Vault Balance / evUSD Supply)`

Where:

* **Vault Balance** is the vault's cumulative profit since inception.
* **evUSD Supply** is the circulating supply of `evUSD`.

When the Vault Balance is positive, the conversion rate remains `1`. When it is negative, the conversion rate falls below `1`.

### Monthly rewards

Rewards are distributed at `00:00 UTC` on the first day of each month.

`Total Reward = max(0, Previous Month's Vault P/L) × Vault Distribution Rate`

Where:

* **Previous Month's Vault P/L** is the vault's profit or loss during the prior calendar month.
* **Vault Distribution Rate** is set by the Everstrike DAO. It is currently `30%`.

Only positive monthly P/L produces rewards. The undistributed share of profit is added to the Vault Balance.

Each eligible holder receives a pro-rata share. The share reflects the holder's average `evUSD` balance during the previous calendar month.

Hold at least `10 evUSD` to receive distributions. Rewards are credited automatically. No manual action is required.

### Protocol fees

Fifty percent of [protocol fees](/trading/trading-fees.md) generated on Everstrike Mainnet are deposited into the vault. These deposits increase the Vault Balance.

### FAQ

#### What is the vault's purpose?

The vault bootstraps liquidity during Everstrike Mainnet's early operation. It also gives `evUSD` holders exposure to vault earnings.

#### Does the vault replace institutional market makers?

No. The vault complements institutional market makers. The DAO can phase it out after market-making activity grows.

#### What happens if the Vault Balance is negative?

A negative Vault Balance reduces the `evUSD` conversion rate below `1`. The rate returns to `1` when the Vault Balance becomes positive.

#### Where can I track the Vault Balance and distribution rate?

Use the official [stats dashboard](https://app.testnet.everstrike.io/app/stats).