# How Do Concrete Vaults Actually Work?

By [nguyentruonggiang](https://paragraph.com/@nguyentruonggiang--) · 2026-03-24

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Most people think DeFi is about chasing yield.

But the truth is:

> **DeFi is about how capital flows.**

And Concrete vaults are designed to control that flow.

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1⃣ **What Happens After You Deposit?**
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When you deposit into a Concrete vault, your funds don’t just sit there.

They enter a system.

A system that immediately begins working:

*   allocating capital
    
*   deploying into strategies
    
*   preparing for yield generation
    

At the same time, you receive **vault shares** — your proof of ownership.

You are no longer holding idle capital.

You are participating in a **live capital system**.

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2⃣ **Shares Are Static — Value Is Not**
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Here’s something important:

Your number of shares usually doesn’t change.

But their value does.

This is where **eRate** comes in.

Instead of increasing your token balance directly, the vault increases the value of each share.

👉 Think of it like owning stock:

*   You don’t get more shares
    
*   But each share becomes more valuable
    

That’s how growth happens.

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3⃣ **NAV: The Pulse of the Vault**
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If eRate is the price per share…

Then **NAV is the heartbeat of the vault**.

NAV reflects:

*   total capital
    
*   active positions
    
*   accumulated yield
    

When strategies perform well → NAV increases.

When NAV increases → eRate rises.

When eRate rises → your position grows.

Everything is connected.

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4⃣ **Continuous Capital Deployment**
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One of the biggest advantages of Concrete vaults:

> **Capital is always working.**

Instead of sitting idle:

*   funds are deployed
    
*   rewards are harvested
    
*   capital is reallocated
    

This is called:

**onchain capital deployment**

And it’s what separates vaults from manual DeFi.

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5⃣ **Why This Matters**
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Without vaults:

*   users react slowly
    
*   opportunities are missed
    
*   capital becomes inefficient
    

With vaults:

*   execution is continuous
    
*   decisions are systematic
    
*   capital remains productive
    

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6⃣ **The Bigger Picture**
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Concrete vaults are not just tools.

They are infrastructure.

They turn DeFi from:

manual actions → automated systems

And that’s how DeFi scales.

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**Mental Model**
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*   Vault = engine
    
*   Shares = ownership
    
*   eRate = price per unit
    
*   NAV = total system value
    
*   Flow = continuous optimization
    

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🚀 **Explore Concrete at app.concrete.xyz**

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*Originally published on [nguyentruonggiang](https://paragraph.com/@nguyentruonggiang--/how-do-concrete-vaults-actually-work)*