> ## Documentation Index
> Fetch the complete documentation index at: https://docs.tiltprotocol.com/llms.txt
> Use this file to discover all available pages before exploring further.

# How It Works

> End-to-end flow: create a fund, trade, accept deposits

# How Tilt Protocol Works

Tilt Protocol connects three participants in a permissionless, on-chain marketplace for investment strategies.

## The Three Roles

<CardGroup cols={3}>
  <Card title="Fund Manager" icon="user-tie">
    Creates and manages a fund. Sets the strategy (asset allocation and weights). Earns curator fees.
  </Card>

  <Card title="Investor" icon="piggy-bank">
    Deposits into funds. Earns returns based on the fund's performance. Withdraws anytime.
  </Card>

  <Card title="Protocol" icon="gear">
    Provides infrastructure: vaults, rebalancing, price feeds, fee accounting. Earns protocol fees.
  </Card>
</CardGroup>

## Current Architecture

<img src="https://mintcdn.com/rontotech/bw4qcPV8fO0Pfntj/visuals/Current_flow.png?fit=max&auto=format&n=bw4qcPV8fO0Pfntj&q=85&s=8850396c5b0cb760072f9685453cd4e1" alt="Current Flow" width="2497" height="1567" data-path="visuals/Current_flow.png" />

Currently, Tilt Protocol operates using a pooled Strategy Vault model. Investors deposit stablecoins into a shared vault managed by a Fund Manager. The Fund Manager's trade signals dictate the portfolio composition, and trades are executed through a Market Maker. Management and performance fees are split between the Fund Manager (up to 90%) and the Protocol Treasury (at least 10%).

## End-to-End Flow

### 1. Fund Creation

A fund manager creates a new vault through the Tilt app or directly via smart contracts:

* Choose a name and ticker symbol (e.g., "AI Momentum Fund" / `tiltAIMF`)
* Select target assets from 100+ available tokens (stocks, ETFs, crypto)
* Set target weights in basis points (e.g., NVDA 30%, AAPL 20%, TSLA 15%)
* Configure curator fee share
* Deposit seed capital (minimum required to initialize the vault)

The protocol deploys an ERC-4626 vault, registers it on-chain, and it's immediately discoverable by investors.

### 2. Investor Deposits

Investors browse available strategies on [tiltprotocol.com](https://www.tiltprotocol.com), review track records and holdings, and deposit tiltUSDC into any vault:

* Deposit any amount (no minimums beyond dust)
* Receive vault shares proportional to current NAV
* Entry fee deducted (default 0.10%)
* Funds are held as unallocated deposits until the next allocation cycle

### 3. Capital Allocation

Unallocated deposits are deployed into the fund's target portfolio:

* The vault calculates buy orders based on target weights
* `RebalanceEngine` executes trades through `TokenRouter`
* Trades execute at oracle prices with slippage protection
* Multiple assets purchased in a single batch transaction

### 4. Strategy Execution

The fund manager updates the strategy over time:

* Propose new target weights (subject to time-lock for investor protection)
* Trigger rebalancing to align holdings with new targets
* The protocol automatically sells over-weight assets and buys under-weight assets

### 5. Investor Withdrawal

Investors can withdraw at any time — withdrawals are never paused:

* Burn vault shares
* The vault auto-liquidates held tokens to tiltUSDC
* Exit fee deducted (default 0.50%)
* Base asset returned to investor

### 6. Fee Collection

Fees accrue continuously and are enforced by smart contracts:

* **Management fees** accrue via share dilution (annualized)
* **Performance fees** accrue above a high-water mark
* Fee revenue splits between the protocol treasury and the curator

## Future Architecture: Independent Mirror Vaults

<img src="https://mintcdn.com/rontotech/f4g0Kc2v8g-zOJHe/visuals/future_flow.png?fit=max&auto=format&n=f4g0Kc2v8g-zOJHe&q=85&s=ef0c127f3d172f0560ba367e87e2c1f6" alt="Future Flow" width="2391" height="1568" data-path="visuals/future_flow.png" />

In the future, Tilt Protocol plans to transition to a truly mirror-style, non-custodial architecture. Instead of a pooled vault, each investor will have their own independent Mirror Vault. The Fund Manager will operate a Master Vault, and their trade signals will automatically replicate across all connected Mirror Vaults. This ensures complete segregation of funds while maintaining automated strategy execution.