> For the complete documentation index, see [llms.txt](https://docs.mirage.money/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.mirage.money/musd/vaults.md).

# vaults

**users mint mUSD by locking collateral into vaults. each vault has four functions: deposit/withdraw collateral, and borrow/repay mUSD.** 

vaults are overcollateralized debt positions containing a single form of collateral and the minted asset. collateralization ratios (c-ratios) are parameterized for each collateral type. for example, highly correlated vaults like USDC/mUSD will have a much lower c-ratio than less correlated pairings such as APT/mUSD. 

if a user falls below the target c-ratio, they risk liquidation. liquidations can be performed by anyone, and the liquidator will receive a fee for processing the liquidation. the mirage team has written open-source software that anyone can run to be a liquidator. of course, you're always free to write your own liquidator as well or modify the existing code.

each vault is a [digital asset](https://aptos.dev/standards/digital-asset/) token (NFT). **this means vaults can be transferred between accounts, listed on a secondary marketplace, and are easily composed across other protocols.** the gives users added flexibility for managing their position and allows other participants to take over positions at a fair market value. from a portfolio management perspective, users will be able to see their vaults from within their wallet.

{% hint style="danger" %}
be careful when transferring vaults. transferring to an unknown address could result in loss of funds. when you transfer a vault, your locked collateral is transferred as well.
{% endhint %}