# Architecture Overview

Alloc8’s architecture connects modular smart accounts, Agents, and policy enforcement to manage and rebalance concentrated liquidity positions.

#### High-level flow

1. **Account Setup**: EOA deploys and configures a Smart Account and installs modules.
2. **Strategy Input**: The system requests optimal ranges from the Agent.
3. **Position Management**: deposits mint LP positions via the Position Manager.
4. **Rebalancing**: agent proposes operations; GSPM validates policy constraints.
5. **Execution**: operations execute through ERC-4337 (bundler → EntryPoint).
6. **Liquidity Update**: Position Manager burns/mints positions to update ranges.

During rebalance/autocompound actions, realized fees/yield may be collected, and the protocol performance fee is applied to the generated yield amount.

Result: non-custodial, policy-based execution for continuous LP optimization.

<figure><img src="https://1880711688-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2Fv3jjLYHyj3WbHXKNnKbK%2Fuploads%2FHgF9NEXktFidY11Fqkub%2FScreenshot%202025-06-27%20at%207.27.21%E2%80%AFPM.png?alt=media&#x26;token=a02bb600-3d0c-4d8c-9b01-4ca2a64d3be0" alt=""><figcaption></figcaption></figure>