> For the complete documentation index, see [llms.txt](https://ipusd.gitbook.io/ipusd-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://ipusd.gitbook.io/ipusd-docs/general/understanding-ipusd-and-the-ip-vault.md).

# Understanding ipUSD and the IP Vault

ipUSD and IP Vault are two separate parts of the product.

ipUSD is the stable dollar used to enter and exit the IP Vault. IP Vault shares are the investment position users receive after a subscription settles.

### ipUSD

ipUSD is the USD stablecoin on Soneium.

It is backed 1:1 by Startale USD (USDSC) and USDC. Users can get ipUSD through the supported assets in the interface and convert it back when needed.

Holding ipUSD does not provide exposure to the IP Vault’s royalty investments and does not participate in changes in the Vault’s NAV.

### IP Vault

IP Vault is the royalty investment layer.

Users subscribe with ipUSD. Once a subscription is settled, they receive IP Vault shares priced at NAV.

IP Vault shares represent a proportional interest in the Vault. The number of shares in a wallet does not automatically increase as the underlying assets change in value. Instead, those changes are reflected in NAV per share.

The Vault can hold:

* tokenized RWA positions;
* an ipUSD liquidity buffer; and
* assets that are still moving through an RWA purchase or redemption process.

The composition of the Vault can change over time.

### RWA

A real-world asset, or RWA, is an economic interest in an offchain asset, fund, or investment vehicle that is represented through a legal structure and an onchain token.

For the IP Vault, an RWA can be understood across three layers:

* the underlying fund or investment strategy;
* the legal vehicle or share class; and
* the onchain token representing that interest.

The token is the onchain representation of the position. It does not replace the underlying legal structure, issuer, valuation method, or redemption terms.

Users do not need to purchase the RWA token directly. The IP Vault holds the RWA position, while users hold IP Vault shares.

### How the assets relate

| Asset           | What it is                                             | Source of value                                                    | Participates in IP Vault performance |
| --------------- | ------------------------------------------------------ | ------------------------------------------------------------------ | ------------------------------------ |
| ipUSD           | The USD stablecoin used across the product             | **USDSC and USDC reserves**                                        | No                                   |
| IP Vault shares | A proportional interest in the IP Vault                | The Vault’s RWAs, ipUSD liquidity buffer, and assets in settlement | Yes                                  |
| RWA             | An underlying investment position held by the IP Vault | Its fund, issuance structure, and valuation                        | Reflected in NAV per share           |

The typical journey is:

**Get ipUSD → Subscribe → Settle → Hold shares**

To exit, users can choose Instant Withdrawal or Standard Withdrawal and receive ipUSD back.