Credit Vaults

The Euler Vault Kit (EVK) allows anyone to deploy, configure and connect credit vaults in various ways. Credit vaults are ERC-4626 compatible vaults extended with functionality for borrowing and liquidations, interest rates, governance, hooks, and more.

Like standard ERC-4626 vaults, Euler's credit vaults enable users to deposit a specified ERC-20 token and receive interest-accruing vault share tokens that represent their deposit. On top of that, credit vaults allow users to borrow tokens deposited in the vault and repay them at a later date. The vault's interest rate model determines the cost of borrowing, while the price oracle helps to keep track of the health of borrowing positions.

The rules for borrowing from a credit vault are determined by a privileged address called the governor admin. They can enable another credit vault to be recognized as collateral and set its maxmium loan-to-value ratio that borrowers must abide to. The vault's price oracle allows existing positions to be continually appraised and should a borrower come into violation of the LTV rules, their position becomes eligible for liquidation.

EVK credit vaults also implement more advanced functions such as flashloans, supply and borrow caps, interest rate fees, mandatory block delays for liquidations, user balance tracking and forwarding, arbitrary hooks on operations, debt socialization, and more.