Vault Managers

Vaults are delegated trading pools where depositors provide capital and a manager (delegate) trades with it under strict withdrawal rules. This guide covers the lifecycle and operations you need as a vault manager. You can manage vaults via the CLI (recommended) or programmatically with the SDK’s VaultClient. For full CLI flags and setup, see the drift-vaults repo.

How it works

Each vault has its own Drift user account that the manager trades with. The manager has delegate authority over this account: they can place and cancel orders and manage positions. Depositors’ funds are pooled in this single account; PnL affects all share holders proportionally. Vaults use share-based accounting: depositors receive shares when they deposit and redeem them after a cooldown (redeem period).

Parameters you set at initialization (and how they can change later):

Parameter	Notes
`name`	Unique identity for the vault.
`management fee`	Annualized; after initialization can only be lowered.
`performance fee` (profit share)	On realized gains; after initialization can only be lowered.
`redemption period`	Withdrawal cooldown in seconds; after initialization can only be shortened.
`permissioned`	If set, only the manager can initialize new vault depositor accounts.
`max_deposits` / `max-tokens`	Capacity limit; can be raised or lowered after init (applies to new deposits only).
`min_lp_deposit` / `min-deposit-amount`	Minimum deposit size; can be changed after init (applies to new deposits only).

Fees: Fee parameters use percentage precision (e.g. 1e6 scale) and are annualized. Management fees apply only when there are non-manager deposits and are charged across the vault; they compound on actions, so more frequent depositor activity slightly reduces the effective annualized fee. Performance fees are calculated per depositor with watermarks so drawdowns don’t cause double-charging; once charged, this fee is not reclaimed.

Managing vaults

Reach out to @wdotsol on Telegram or fill in this form to get your vault listed on the Drift UI.

Step 1: Understand roles and lifecycle

Manager/delegate: trades for the vault, updates allowed parameters, collects fees.
Depositor: deposits, requests withdrawals, and completes withdrawals after the redeem period.

Lifecycle: create → deposit → trade → request withdraw → wait (redeem period) → withdraw.

Step 2: Decide vault parameters

Parameter	Description
`market-index` / `spotMarketIndex`	Deposit token (e.g. 0 = USDC).
`redeem-period`	Withdrawal cooldown in seconds (often 3–7 days).
`max-tokens`	Capacity / risk control.
`management-fee`	Annualized management fee.
`profit-share`	Performance fee on realized gains.
`permissioned` + `min-deposit-amount`	Optional onboarding controls.

Step 3: Initialize the vault

Vault initialization is permissionless. From the drift-vaults CLI:


yarn cli init-vault \
  --name "MyVault" \
  --market-index 0 \
  --redeem-period 604800 \
  --max-tokens 0 \
  --management-fee 200 \
  --profit-share 2000

Add --permissioned and --min-deposit-amount <amount> if you want whitelisted depositors and a minimum deposit size. Vault name must be unique.

Step 4: Update parameters and enable trading

After creation you can lower fees, shorten redeem period, or adjust caps (within the one-way constraints above):


yarn cli manager-update-vault \
  --vault-address <VAULT_ADDRESS> \
  --redeem-period 1000 \
  --max-tokens 200000 \
  --management-fee 0 \
  --profit-share 0

To enable margin trading on the vault:


yarn cli manager-update-margin-trading-enabled \
  --vault-address <VAULT_ADDRESS> \
  --enabled true

View vault state anytime:


yarn cli view-vault --vault-address <VAULT_ADDRESS>

Step 5: Permissioned vaults (allowing depositors)

For permissioned vaults, the manager must initialize each depositor:


yarn cli init-vault-depositor \
  --vault-address <VAULT_ADDRESS> \
  --deposit-authority <AUTHORITY_TO_ALLOW_DEPOSIT>

Deposits and withdrawals are otherwise as in the standard flow: request withdrawal → wait redeem period → complete withdrawal.

Step 6: Manager operations

Common manager actions:

Manager deposit/withdraw
Apply profit share across depositors
View vault state and depositors

See the drift-vaults CLI for the full command list and flags.

Step 7: Security and guardrails

Managers cannot withdraw user funds directly; withdrawals are governed by redeem period and share accounting.
Managers can decrease (but not increase) the redeem period and can only lower fees after initialization.

Trusted vaults

Trusted vaults extend the base vault with manager borrowing and (when enabled) margin trading. They are created like a normal vault; an admin must then update the vault class to Trusted. Once upgraded, the manager can borrow assets from the vault and repay or mark-to-market the borrow.

Trusted vaults must be approved by the Drift team before they can be used in production.

Vault depositors in Trusted vaults place significant trust in the manager. Borrowing and margin increase the manager’s ability to move or risk vault capital. Depositors should only use Trusted vaults when they accept this additional trust assumption.

Borrow: Move vault assets out (e.g. USDC) up to the vault’s capacity. Vault equity for share accounting includes the manager’s borrowed value so depositor share price reflects the full claim on the vault.


yarn cli manager-borrow \
  --vault-address <VAULT_ADDRESS> \
  --borrow-spot-market-index 0 \
  --borrow-amount <AMOUNT>

Repay: Send tokens back into the vault and reduce the outstanding borrow. You can repay in the same asset or another spot market and specify the value to deduct from manager_borrowed_value; omit amount to repay the full borrow.


yarn cli manager-repay \
  --vault-address <VAULT_ADDRESS> \
  --repay-spot-market-index <INDEX> \
  --repay-amount <AMOUNT> \
  --repay-value <VALUE_IN_DEPOSIT_ASSET>

Update borrow value: If borrowed funds have been used elsewhere and their mark-to-deposit-asset value has changed, you can set the tracked borrow value to the current mark:


yarn cli manager-update-borrow \
  --vault-address <VAULT_ADDRESS> \
  --new-borrow-value <VALUE>

Trusted vaults typically use margin trading; enable it with manager-update-margin-trading-enabled as in Step 4.

Multisig manager

The vault manager is the ultimate owner: they update parameters, fees, and the trading delegate, and collect fees. The manager is set to the signer of the vault creation transaction and can be changed with update_vault_manager (signed by the current manager).

New vault with multisig as manager: Set the manager to your Squads (or other multisig) address and use --dump-transaction-message to output a base58 transaction blob. Create a transaction in Squads (Developers → TX Builder → Create Transaction → Add Instruction → Import from base58), then have signers approve and execute.


yarn cli init-vault \
  --name <VAULT_NAME> \
  --market-index <SPOT_MARKET_INDEX> \
  --redeem-period <SECONDS> \
  --profit-share <BPS_OR_PCT> \
  --min-deposit-amount <AMOUNT> \
  --manager <MULTISIG_ADDRESS> \
  --dump-transaction-message

Existing vault: Transfer management to a multisig by having the current manager run:


yarn cli manager-update-vault-manager \
  --vault-address <VAULT_ADDRESS> \
  --new-manager <MULTISIG_ADDRESS>

Any manager command via multisig: Use --dump-transaction-message on manager commands (yarn cli manager-*) to get a base58 blob, then import it in Squads as above. The CLI uses the manager as fee payer, so ensure the multisig wallet has enough SOL for transaction fees.

Accounting

Share price is implied as vault_equity / total_shares in the vault’s deposit asset. Vault equity is the value of vault assets (and for Trusted vaults includes the manager’s borrowed value). Depositor and manager shares are tracked on the vault and depositor accounts.

What to monitor and risks

Liquidations: If a depositor has waited the redeem period and their withdrawal would breach the vault’s initial margin requirement (e.g. the delegate is over-leveraged), a permissioned liquidator can temporarily assume delegate control and close positions in reduce-only mode (until withdrawal is processed or for up to 1 hour), then restore the original delegate. Monitor total outstanding withdrawal requests (stored on the vault account) and keep margin usage in check so depositor withdrawals don’t trigger takeovers; the redeem period gives you time to unwind positions.

Trust and incentives: The design is not trustless between depositors and managers. Without reputation or stake, incentives can be misaligned (e.g. moving value via losing trades). Depositors have no on-chain recourse, so they must trust the manager. Operate with clear terms and consider reputation or skin-in-the-game where appropriate.

drift-vaults , CLI and TypeScript SDK for vault operations
Protocol Concepts, accounts and onchain data model
Drift SDK, core trading and positions SDK