---
title: Vault Life Journey
slug: vault-life-journey
icon: 🏖️
docTags: 
createdAt: 2023-03-28T17:12:37.000Z
---

Typus Vaults will go through this journey in their life cycle:

1. Creation
2. Auction
3. Delivery
4. Settlement

![](https://api.archbee.com/api/optimize/f0wpBLycD4SqdLxdQePJn/HPpJh4Cr_4s7P93F2tsUz_image.png "A Single Round of a Vault")

# Creation

When a vault is created, the vault enters its `Warmup Period`. [Vault Depositors (Option Sellers)](https://docs.typus.finance/vault-depositor-option-seller) are able to deposit or withdraw anytime from `Warmup Balance` before auction starts.

# Auction

Once auction starts, it's the solo time for [Vault Bidders (Option Buyers)](https://docs.typus.finance/vault-bidder-option-buyer) to step into the auction and bid for their desired positions. Now the vault turns into its `Lockup Period` and all positions are activated into `Active Balance` from `Warmup Balance`, depositors are able to unsubscribe anytime from `Active Balance` before the settlement. 

Your deposit during the `Lockup Period` will not go into the ongoing auction, but you still can deposit whenever you want as long as there is capacity in the next round.

Unsubscribing funds will involve a 2-step process:

1. Send a request to `Unsubscribe` funds. Your `Active Balance` will be moved to `Deactivating Balance`.
2. Come back to `Claim` your funds once the `Lockup Period` ends ([Vault Settlement](https://docs.typus.finance/vault-settlement)).

![](https://api.archbee.com/api/optimize/f0wpBLycD4SqdLxdQePJn/28UIg87aBCSFu-NaPxcLC_image.png)

The auction mechanism is elaborated in the [Modified Dutch Auction](https://docs.typus.finance/modified-dutch-auction).

# Delivery

When an auction ends, the vault stays at `Lockup Period` but the Option Premium (Depositors Reward) will be delivered from [Vault Bidders (Option Buyers)](https://docs.typus.finance/vault-bidder-option-buyer) to [Vault Depositors (Option Sellers)](https://docs.typus.finance/vault-depositor-option-seller), so Vault Depositors (Option Sellers) are able to harvest or compound their rewards anytime.

If your deposit is filled successfully, it will be in `Active Balance` during the `Lockup Period`. Otherwise, your deposit will stay in `Warmup Balance` and you can withdraw it anytime.

::Image[]{src="https://api.archbee.com/api/optimize/f0wpBLycD4SqdLxdQePJn/0HwGTixRSfOTwrJYCtT9A_image.png" size="50" width="866" height="1160" position="center" showCaption="false"}

Details are described in [Auction Delivery](https://docs.typus.finance/auction-delivery).

# Settlement

On the expiration date of an option strategy, the vault will be settled by a [Settlement Price](https://www.investopedia.com/terms/s/settlementprice.asp), the level of the underlying market price at the time of execution. We use [Pyth 1 Hour EMAP](https://docs.pyth.network/documentation/how-pyth-works/ema-price-aggregation) as the settle price.

The profit and loss of [Vault Depositors (Option Sellers)](https://docs.typus.finance/vault-depositor-option-seller) will be calculated by the [Strike Price](https://www.investopedia.com/terms/s/strikeprice.asp) and Settlement Price. Then the vault evolves into the next round, the life of another round has begun, and the remaining funds of Vault Depositors (Option Sellers) will be auto-reinvested in the next round.

Go check more at [Vault Settlement](https://docs.typus.finance/vault-settlement).

![](https://api.archbee.com/api/optimize/f0wpBLycD4SqdLxdQePJn/LIbdGqPhHMTkXQjpD9aCq_image.png "Multiple Rounds of a Vault")