The IL Reserve Fund is a dedicated vault designed to absorb impermanent loss shocks during liquidity provisioning.
Over time, the ILRF accumulates capital from yield cycles. A portion of strategy yield (typically 10–20%) is allocated to the IL Reserve Fund based on the Protocol Health Index (HI), strengthening the system’s ability to offset LP-related volatility and preserve user principal. This enables the protocol to:
Offset short-term liquidity discrepancies
Support the Health Index during volatility
Protect user principal from LP-related losses
Stabilize overall vault performance across market cycles
The ILRF is activated automatically through solvency triggers defined in the Health Index thresholds.
The ILRF is held in a multisig wallet managed by the Prime Vaults Foundation and can be tracked on-chain here: IRLF
