Fees Structure

City Protocol implements a transparent, on-chain fee structure designed to align the incentives of vault operators, depositors, and the protocol itself.

All fee structures are encoded directly in the vault's smart contract and visible to any investor prior to deposit, eliminating information asymmetry between managers and their depositors.

Fee Types

Fee Type	Charged On	When Collected
Management Fee	Total AUM (accumulates continuously over time)	At each settlement
Performance Fee	New profits above the high-water mark	At each settlement
Entry and Exit Fee	New deposit and withdrawal requests	At each settlement
Protocol Fee	Vault fees collected (capped at 30%)	At each settlement

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Fee Distribution

At every settlement, the vault mints new shares to represent the fees owed. These shares are sent directly to the feeReceiver address configured at vault creation.

Fees are distributed as shares, not assets. This means the fee receiver participates in the vault's performance from the moment fees are collected, without triggering any asset movement.