No prior DeFi knowledge assumed. If you know what a bank account is, this will make sense.
Every deposit goes into one shared pot. In return you receive nXLM, which is your claim on a slice of that pot. If you put in a hundredth of the vault, you hold a hundredth of the nXLM.
The quantity you receive is fixed at that moment and never changes again. No rebasing, no airdrops into your wallet, no balance that creeps upward while you sleep.
Roughly ninety percent of the pot is supplied to Blend, a lending market on Stellar. Borrowers put up collateral, take XLM, and pay interest for the privilege. That interest is the entire source of your yield.
The other ten percent stays idle in the vault on purpose, so ordinary withdrawals do not have to unwind a lending position to pay you.
Nebula supplies without using the position as collateral, and never borrows. That means the position carries no health factor and cannot be liquidated. It is the boring end of lending, deliberately.
On a schedule, an automated keeper collects the interest Blend owes and puts it back into the vault. The pot grows. The number of nXLM in existence does not.
So each nXLM is now a claim on slightly more XLM than before. That is the share price rising, and it is the only thing that ever moves it upward.
You do not claim anything, compound anything, or press any button. It happens whether or not you are watching.
Hand back your nXLM and the vault burns it, then pays you your slice of the pot at the current share price. Because the pot grew and your slice did not shrink, you get back more XLM than you put in.
Redeeming does not move the price for anyone else. It removes XLM and nXLM in exactly the same proportion, so the ratio is untouched. That is a deliberate property: if withdrawing nudged the price, someone could loop deposits and withdrawals to milk the difference.
Deposits can be halted by the admin. Getting your money out cannot be, by construction. A vault that can trap funds is a custodian.
The share token's minter is fixed at deployment and cannot be rotated. There is no admin key anywhere that can print unbacked shares.
It can register strategies and set the fee and reserve target. It cannot move deposits, mint, or block redemptions.
It only moves money between the vault and already-registered strategies. That is why it is safe to run unattended.
The vault holds one invariant at all times: total assets equals the idle reserve plus everything deployed to strategies. It is asserted after every operation.
Ten percent of what the vault earns. If it earns nothing, it charges nothing. Your principal is never touched.
Nebula is on testnet, where nothing is real money. When it is not, these are the things that could cost you.
Nebula's contracts could contain a bug. They are open source, covered by 57 tests including the known attack classes, and deposits are capped during beta. That reduces the risk. It does not remove it.
Your XLM sits in someone else's lending market. If Blend has a bug or takes bad debt, Nebula is exposed to it. Each strategy has a hard ceiling so no single venue can take the whole vault.
A lending pool that is fully borrowed out cannot be exited until borrowers repay. A large redemption can fail in that window. The app shows what is genuinely redeemable right now, not just what you own.
Interest depends on people wanting to borrow. If borrowing demand dries up, the share price stops rising. It will not fall, but it will sit still.
Every deposit, harvest and withdrawal is a public transaction on Stellar testnet. Nothing about how the vault behaves has to be taken on trust. See the live numbers.