VedaVault

A Looping Mechanism to Maximize Yield and Guarantee Safer Returns

This repository contains my implementation of the VedaVault strategy — a stHYPE looping vault built as part of an assignment from Anthias Labs.

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Assignment Goal

The goal was to create a fully on-chain vault that loops user deposits to maximize yield while maintaining safety and transparency. Inspired by Boring Vault, I expanded the design to include better parameter checks, sanitizer logic, monitoring tools, and a clear separation between on-chain and off-chain responsibilities.

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The Prompt (Option 1: stHYPE Looping Vault)

Here’s the exact assignment:

Build a vault that accepts wHYPE, stakes it to stHYPE, and loops that collateral in Felix markets to maximize yield. The vault should borrow HYPE, wrap it, and repeat the loop until reaching a safe collateral ratio.

Loop Strategy (Summarized)

1. Accept user deposits in wHYPE
2. Stake those into stHYPE
3. Supply stHYPE as collateral on Felix
4. Borrow HYPE, rewrap into wHYPE, and repeat

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What I Implemented

Vault Strategy (On-Chain)

I broke the entire on-chain logic into 4 modular phases:

1. Deposit Logic

• The user calls deposit() with their wHYPE
• I transfer the tokens in, verify with sanitizers
• I mint a receipt token (vvHYPE) back to the user — representing their share

2. Staking Logic

• I call Overseer.mint() to convert wHYPE to stHYPE
• The staked tokens are held by the vault

3. Collateral + Borrowing

• I send the stHYPE to Felix as collateral
• I borrow HYPE based on a safe LTV
• I wrap that borrowed HYPE back into wHYPE

4. Looping

• I repeat Steps 2 & 3 until the loop hits a threshold (defined by me or by automation)
• This compounds the deposit into a much larger yield-generating position

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Monitoring & Automation (Off-Chain)

To keep everything healthy and safe, I built off-chain scripts to:

• Monitor vault deposits (both HYPE and USD value)
• Track total stHYPE supplied to Felix
• Track outstanding HYPE borrowed
• Calculate yield (APY) over time

I designed this in a way that it could easily be plugged into automation platforms like Gelato or Chainlink Keepers.

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Contract Architecture

1. VedaVault.sol — The Core Contract

This is the main entry point for the user. It handles:

• Deposits
• Staking into Overseer
• Borrowing from Felix
• Token issuance (vvHYPE)
• Withdrawals (burning vvHYPE)

2. Overseer — External Protocol

Used to stake wHYPE into stHYPE. I don’t own this; I just call it.

3. Sanitizers.sol — Guard Rails

I abstracted some key validations into a reusable contract. It includes:

• onlyEOA — blocks contract interactions
• onlyWhitelisted — lets me allow/deny specific users or bots
• Parameter validators (checkOverseerAddress, etc.)

4. vvHYPE — Receipt Token

An ERC20 vault token that I mint 1:1 to wHYPE deposits.
Users hold this token as proof of their vault share and can burn it to withdraw.

5. Exchange Rate Oracle (Future)

I plan to add a custom oracle that dynamically computes vault share prices. Initially, 1 vvHYPE = 1 wHYPE, but this will shift as looping and yield kick in.

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Automation Components

To keep everything smooth, the off-chain components do:

• Auto-reinvestment when collateral space opens
• Health checks on LTV ratios
• Emitting events to analytics dashboards (via Supabase + Ponder)
• Alerting + logging

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What is finished so far

Here’s what’s fully working and tested:

• User deposits wHYPE
• Vault mints vvHYPE
• Funds are staked into stHYPE
• Borrowing and re-wrapping logic is ready
• Merkle proofs are generated for event logs
• Vault monitoring dashboard is wired up

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Tech Stack

• Solidity 0.8.x
• OpenZeppelin Contracts
• Supabase — Vault monitoring database
• Ponder — Indexing events from the chain
• Felix Protocol — For lending/borrowing
• stHYPE Protocol — For staking