The “Bank Upgrade” Analogy

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How Concrete Vaults Turn Deposits Into Growing Value

Traditional finance teaches us:

Deposit money → earn interest

But in DeFi vaults, it works differently.

Let’s break down how Concrete vaults actually work.

1. The User Experience

You deposit funds.

Instead of a balance increasing directly, you receive:

• Vault shares
• A changing eRate
• A growing NAV

It feels abstract.

So let’s simplify it.

2. Shares = Ownership, Not Balance

In Concrete vaults:

You don’t hold tokens like USDC anymore.
You hold shares of a system.

Think of it like:

Owning stock in a company instead of holding cash.

Your shares represent:
👉 A percentage of the vault

3. eRate = Price Per Share

The eRate is like a stock price.

• Start: 1 share = $1
• Later: 1 share = $1.08

You still own the same number of shares —
but they’re worth more.

That’s yield.

4. NAV = Total Value

NAV is simply:

Everything the vault owns, combined

If strategies generate profit:
👉 NAV increases

And when NAV increases:
👉 eRate increases

5. Why Time Is Critical

Short-term thinking doesn’t work here.

Because:

• Strategies take time to produce results
• Frequent withdrawals hurt efficiency
• Compounding needs duration

Think of it like:

Baking bread — you can’t rush the process

6. Active Strategy Layer

Concrete vaults are managed DeFi systems.

They:

• Move capital between opportunities
• Adjust to market conditions
• Optimize returns

This is not passive staking.

It’s onchain capital deployment.

7. The Outcome

Over time:

• NAV grows
• eRate rises
• Your shares become more valuable

That’s automated compounding in action.

8. Final Model

• Vault = capital engine
• Shares = ownership units
• eRate = share price
• NAV = total assets
• Time = compounding driver
• Management = alpha source

Explore Concrete at app.concrete.xyz