Vaults is an automation tool to continually invest and reinvest deposited funds, which help to achieve high levels of compounded interest and hence results in higher profits.
While visitng, smart vaults on https://smartvaults.cafeswap.finance you will see the annual percentage yield (APY) which takes into consideration all compounding. You will also see the daily interest and amount invested in the vault by all users and your deposited amount if any.
Each vault can either refer to a pair of tokens invested in liquidity pools within the Binance Smart Chain ecosystem or a single token invested in lending platforms. After investing their tokens, the user is supplied with svCafe Tokens which represents their stake/vault shares.
How does vault works?
Deposit LP/Single tokens in the vault.
Vault deposits token to the respective platforms contract.
You get vault share tokens to determine your deposit share(svCafe).
Vault reinvest the profits gained from your investment.
You get increased APY on the vault.