> For the complete documentation index, see [llms.txt](https://docs.avantisfi.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.avantisfi.com/liquidity-providers/avantis-lp-vault-avusdc.md).

# Avantis LP Vault (avUSDC)

**Avantis LP Vault (avUSDC)**

avUSDC is the Avantis liquidity provider vault — a single, unified USDC pool that acts as the counterparty to every trade on the platform. LPs deposit USDC, receive avUSDC, and earn a majority share of the trading fees generated by platform activity.

<figure><img src="/files/Sszf8VnjbXVrUQqOSXjf" alt=""><figcaption></figcaption></figure>

|                               |                                                            |
| ----------------------------- | ---------------------------------------------------------- |
| **Token**                     | avUSDC (ERC-4626)                                          |
| **Underlying asset**          | USDC                                                       |
| **Network**                   | Base                                                       |
| **Fee share to LPs**          | 70% of opening, closing, and win fees; 100% of margin fees |
| **Launched**                  | October 2025                                               |
| **Return, Inception to date** | 35%                                                        |

***

**How avUSDC works**

The avUSDC vault is the counterparty to all trades on Avantis.

When traders lose, those losses accrue into a **protocol buffer** used to settle future payouts. When traders win, their profits are paid out of that buffer before any draw on vault principal.

This is the key structural point: **LPs do not earn from trader losses.** They earn from real trading fees generated by platform activity, while market makers keep the vault delta neutral. Yield tracks onchain market volume rather than directional bets against traders — which is what makes it steady and organic rather than speculative.

The buffer is also the primary risk control. It absorbs volatility in trader PnL so that LP capital stays protected through periods of high market stress.

***

**Where the yield comes from**

Every position opened on Avantis pays fees. Those fees are split between LPs, the $AVNT buyback-and-burn program, and the protocol treasury:

| Fee type         | Liquidity providers | Buyback & burn | Protocol treasury |
| ---------------- | ------------------- | -------------- | ----------------- |
| Opening fees     | 70%                 | 30%            | —                 |
| Closing fees     | 70%                 | 30%            | —                 |
| Win fees         | 70%                 | 30%            | —                 |
| Margin fees      | 100%                | —              | —                 |
| Liquidation fees | —                   | —              | 100%              |

Margin fees go entirely to LPs because they compensate for cost of capital and hedge against volatility and unhedged trades — keeping that share whole is what protects LP returns and sustains liquidity depth. Liquidation fees fund protocol operations and have always sat outside the LP share.

> **Historical note.** From launch in October 2025 until 11 March 2026, LPs received 100% of trading fees excluding liquidation fees. The 30% buyback allocation on opening, closing, and win fees took effect on that date. See $AVNT Buyback and Burn for the full mechanism and the Milestone 2 roadmap.

Because avUSDC is an ERC-4626 vault token, yield accrues to the **exchange rate** rather than through separate reward claims. The avUSDC balance stays constant; the amount of USDC each share redeems for grows over time. There is nothing to harvest and no reward token to sell.

Realized return inception-to-date is **35%**. Because the yield is fee-driven, it rises and falls with trading volume across the platform's crypto, FX, commodity, and index markets. Note: past returns do not guarantee future performance.&#x20;

***

**Composability.**

A single standardized vault token is what makes avUSDC useful outside of Avantis. Because it follows ERC-4626, it plugs into the rest of DeFi without custom integration work.

**Collateral.** avUSDC is usable as collateral, which opens looping strategies: deposit USDC, mint avUSDC, redeploy it with leverage. Yield potential is amplified without capital leaving the ecosystem.

**External yield.** Idle vault capital can be routed into uncorrelated yield sources, giving LPs exposure beyond trading activity alone.

The result is that a deposit is no longer a static, siloed position. It can power Avantis, earn trading fees, and participate in the broader DeFi market at the same time.

***

**Summary**

avUSDC is the liquidity layer underneath Avantis perpetuals — one pool, one token, fee-driven yield, and a buffer that sits between trader PnL and LP principal. For liquidity providers it removes the tradeoff between earning yield and retaining flexibility: the same deposit can market-make for the exchange and remain composable across the rest of DeFi.