❔Vaults FAQ

How often do the vaults compound?

Vaults are normally harvested multiple times daily and profits are automatically reinvested (compounded). Higher TVL vaults typically compound more frequently than lower TVL vaults.

Why can't someone just do this themselves?

They could, but vaults help you save on personal time and transaction fees, maintain healthy collateral to debt ratios, self-optimize for the best possible yields, and automatically reinvest earnings. And since a portion of performance fees are being returned to the underlying tokens via bbb, you can be sure you’re getting the best value for your money.

Does the vault page show the APY?

Yes! Our displayed APY values reflect the predicted rate earned on a vault in a year. This rate is determined by the underlying platform it uses, the strategy that it is interacting with at the time, the total amount of funds in the vault and also takes into account the effect of compounding. We have also included all vault fees in the APY calculation, so what you see is what you get!

What Risks Do the Vaults Have?

Magik Farm vaults are internally audited, based on battle tested code, and have been running exploit free for almost 9 months. But this does not mean that the strategies are 100% "safe". Below are some of the general vault risks:

- Assets deposited into the vault have no risk of decreasing in quantity but can decrease in monetary value.

- As with any smart contract, the ultimate risk is that an investor's funds can end up stolen or unable to be withdrawn. The team does take steps to quantify the security risks of smart contracts and only will interact with ones that meet a specific set of requirements after excessive testing to make sure the underlying platform does not contain so called 'rug-pull' functions. But always DYOR before investing in any third party protocol.

- Human error in contract deployment, unforeseen vulnerabilities in code as well as potential front end attack vectors that are unavoidably attached to fewer points of failure.

What Will I Get Out When I Make a Vault Withdrawal?

You will always withdraw the token type that you deposited, because at Magik Farm you earn what you stake. You will get the amount you deposited plus the yield generated minus the vault withdrawal fees (usually 0%, occasionally .1% on specifically listed strategies to prevent reentrancy attacks).

How Do LP Vaults Work?

Liquidity pool (LP) vaults work by reinvesting the fees awarded to LP participants. In return for providing liquidity to the pool, many platforms reward investors with tokens. Our vaults harvest and sell these rewards to buy more of the LP’s underlying assets and deposit them in the vault.This compounds the rewards gained from a liquidity pool.

Magik Farm creates strategies that automate this process, saving you time and gas fees.

How Often Are Balances Updated in the Vaults?

Pending rewards are not reflected in the balance until they are swapped for the initial deposited token. This can vary depending on the strategy running.

How Do Vaults Get Added to Magik Farm?

New potential vaults can be discussed in our Discord in the #vault-requests channel. Our strategists then add the investment strategy to our onboard queue. A priority is assigned to each new potential strategy based on its APY, TVL and sustainability. Our developers/strategists then attack the list from top priority to bottom.

Ultimately, there will be a decentralized easy onboarding process, to ensure MAGIKFARM belongs to its users.