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Tokenized Vaults require accurate pricing to function correctly. Vault shares cannot be issued without a precise calculation of Assets Under Management (AUM). To determine AUM, GLAM must price each asset (token or DeFi position) held by the vault. For example, consider a tokenized vault that allocates capital across Drift Vaults and Kamino Lending. At the time of subscription, GLAM computes the exact AUM to determine how many shares to issue:
AUM=∑t∈Tokens+∑i∈DriftVaultsvi+∑j∈KaminoLendingvj+⋯\text{AUM} = \sum_{t \in \text{Tokens}} + \sum_{i \in \text{DriftVaults}} v_i + \sum_{j \in \text{KaminoLending}} v_j + \cdots Where:
  • vtv_t is the value of each individual token held by the vault
  • viv_i is the value of each individual position in Drift Vaults
  • vjv_j is the value of each individual position in Kamino Lending
GLAM supports pricing AUM in any base asset, using a curated set of oracles from Pyth and Switchboard.

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Functional Pricing for LSTs

For liquid staking tokens (LSTs), GLAM uses functional pricing whenever possible. Each LST (like mSOL, jitoSOL, bSOL, etc.) represents a claim on staked SOL plus staking rewards, therefore they have an intrinsic value backed by SOL in the pool. The conversion rate can be calculated onchain from the LST’s pool state account: ConversionRate=Stake Pool SOL BalanceLST Token Supply\text{ConversionRate} = \frac{\text{Stake Pool SOL Balance}}{\text{LST Token Supply}} With the conversion rate, the functional price of the LST can be calculated as: FuncPrice=SOL Price (USD)×ConversionRate\text{FuncPrice} = \text{SOL Price (USD)} \times \text{ConversionRate}

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Benefits of Functional Pricing

  • Depeg Protection: Protects users from temporary market depegging events where LST spot prices may trade below their intrinsic value
  • Accurate Valuation: Reflects the true underlying value based on staked SOL and accrued rewards, not market sentiment
  • Reduced Manipulation Risk: Eliminates the risk of oracle manipulation or flash loan attacks on LST spot prices
  • Consistent Pricing: Provides stable, predictable pricing that follows the actual staking yield mechanics
  • Fair Entry/Exit: Ensures users receive fair value when subscribing to or redeeming from vaults holding LSTs