# Vault Valuation

## What NAV drives

The Net Asset Value (NAV) sets the price-per-share used at settlement. It has three direct consequences:

1. How many shares are minted when a deposit settles
2. How much USDC is returned when a redemption settles
3. How fees are computed (management and performance fees are calculated against NAV at each update)

## What counts toward the valuation

The NAV reflects only positions actively held by the Curator. Pending deposits sitting in the silo are excluded because they haven't entered the managed assets yet.

Example:

| Component                  | Amount  |
| -------------------------- | ------- |
| Curator managed balance    | 10 USDC |
| Pending deposits (in silo) | 5 USDC  |
| Pending redemptions        | 2 USDC  |
| NAV used for settlement    | 10 USDC |

## Two-step process

The valuation is split across two roles to prevent either party from acting unilaterally:

```
Valuation Provider  ->  proposes NAV  ->  stored in contract, not yet applied
        |
Curator             ->  reviews and approves  ->  triggers settlement
```

Neither can push a valuation through on their own.

## How valuations are computed

Off-chain (by an external or internal provider, submitted manually) or on-chain via smart contracts pulling position data directly from connected protocols. Both are valid, the choice depends on the complexity of the underlying positions.

## Initial state

At deployment, NAV starts at zero. The first update happens once the Curator begins deploying capital.

***

*Next:* [*Roles*](/flintrwa-docs/technical-architecture/roles.md)


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