ERC-4626

ERC-4626 is a token standard for tokenized yield-bearing vaults on Ethereum and compatible blockchains. It defines a common interface that a vault contract follows, so different applications can interact with any vault in the same way.

Under the standard, a user deposits an underlying asset into a vault and receives shares in return. Those shares represent a claim on the vault's holdings. As the vault's assets change, the value of each share changes with them. When a user withdraws, the contract redeems shares back into the underlying asset. The standard sets rules for how deposits, withdrawals, and share accounting are calculated and reported.

Because vaults built on ERC-4626 share one interface, they are easier to integrate, compare, and audit. A vault that follows the standard still carries the risks of the strategy it runs and of the smart-contract code itself.