Understanding the Protocol

The Spool Protocol is an umbrella of many Smart Vaults that dynamically reallocate capital between their various Strategies/Protocols based on the Risk Scores calculated by their individually set Risk Appetite and Risk Models.

Spool allows users to maintain their desired level of risk exposure despite ever-changing market conditions, while also minimizing their gas costs, labor, and exposure to potential black swan events by rebalancing capital at a larger scale.

The Spool Protocol consists of multiple moving parts, namely:

Spool Smart Vault(s):

A Spool Smart Vault is a "vault" consisting of creator defined settings for Strategies, a Risk Model, a Risk Appetite setting and (potential) rewards. Anyone can create a Smart Vault by selecting their favorite Strategies, a Risk Model and a Risk Appetite.

A Strategy:

A Strategy is a smart contract that interacts with an actual Yield Generator, like Aave. A Strategy manages deposits, withdrawals, balance tracking and re-compounding for any number of Smart Vaults.

A Risk Model:

A Risk Model is a quantitative model built to assess and assign Risk Scores associated with a Strategy/Protocol. Risk Models are only included within the Spool ecosystem when vetted and voted on by the DAO.


DoHardWork() The implementation of an aggregate function call allows Spool to dynamically re-allocate capital without the need to tax the user for it.

The Buffer System:

The Buffer System. The Buffer System minimizes the gas costs associated with participating in the Spool Ecosystem.

The Spool Protocol

All aforementioned aspects together form the Spool Protocol.

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