> For the complete documentation index, see [llms.txt](https://praxis-4.gitbook.io/praxis/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://praxis-4.gitbook.io/praxis/documentation/how-it-works/vaults.md).
# Vaults
The entry point for capital: how vaults accept deposits, generate yield, and define your position.
A vault is where a Praxis position begins. Deposit USDC, receive two tokens, and let the vault do the work until maturity.
***
## Depositing
When you deposit USDC into a vault, two tokens are minted to your wallet at a **1:1 ratio**:
| You deposit | PT received | YT received |
| ----------- | ----------- | ----------- |
| 100 USDC | 100 PT | 100 YT |
| 500 USDC | 500 PT | 500 YT |
Both tokens are minted as standard ERC-20s. They are independent: you can hold, trade, or use them separately.
Depositing mid-epoch incurs a **late deposit fee** equal to the yield already accumulated in YT at that point. The fee is folded into the YT you receive, not deducted from your wallet so the net effect is zero. See [PT & YT](/praxis/documentation/how-it-works/pt-and-yt.md#depositing-mid-epoch) for a more detailed explanation.
***
## Yield generation
While the vault is active, deposited USDC is deployed into [Morpho](/praxis/documentation/advanced/yield-sources.md) to generate yield. This yield continuously accrues into the YT exchange rate — your YT count stays the same, but each YT becomes worth progressively more as the epoch progresses.
Your principal (the USDC backing your PT) is never touched by yield strategies or prediction activity.
***
## Vault duration
Each vault runs for a fixed period. Duration varies per vault, is set at launch and does not change. The maturity date is always displayed on the vault detail screen.
{% hint style="info" %}
Vaults do not auto-renew. When a vault matures, you must re-deposit into a new vault to start a new position.
{% endhint %}
During the transition between vaults, there is a short window where **two vaults are active simultaneously:** the outgoing vault (at or near maturity) and the incoming one. You can exit the old vault and deposit into the new one independently, at your own pace.
***
## Exiting the vault
How you exit depends on whether the vault has reached maturity.
### Before maturity
To withdraw early, you need **both tokens in equal amounts**:
$$
X \text{ PT} + X \text{ YT} \rightarrow X \text{ USDC} + Yield
$$
When exiting the vault before maturity, you withdraw your full principal deposit and the yield it has accrued up to that point.
You can exit partially — burn 300 PT + 300 YT to reclaim 300 USDC, leaving the rest in place. Any PT you hold without a matching YT must wait until maturity.
{% hint style="warning" %}
Every time you use YT (on predictions or games), you potentially reduce your early exit capacity by the same amount. A zero YT balance means early exit is no longer available.
{% endhint %}
### At maturity
Once the vault ends, PT and YT can be redeemed independently:
{% stepper %}
{% step %}
## Burn PT → Redeem Principal
Return PT to the vault and receive your full original deposit: 1 PT = 1 USDC.
{% endstep %}
{% step %}
## Burn YT → Redeem Yield
Return YT to the vault and receive your proportional share of the total yield the vault generated over the full epoch. The more YT you hold relative to total YT supply, the larger your share.
{% endstep %}
{% endstepper %}
There is no deadline to redeem after maturity — your tokens remain valid until you choose to burn them.
***
## Summary
| Scenario | Action | What you receive |
| ------------------------------- | ---------------------- | ---------------------------------------------------- |
| Deposit | Transfer USDC to vault | PT + YT (1:1) |
| Early exit (pre-maturity) | Burn PT + YT (1:1) | USDC (equal to burned PT) + Yield (up-to-date share) |
| At maturity — reclaim principal | Burn PT | USDC (equal to burned PT) |
| At maturity — claim yield | Burn YT | Proportional share of vault yield |
***
How PT & YT workExit paths in detail
