ERC-4626 (Tokenized Vault Standard)

ERC-4626 is the tokenized vault standard - a common interface for yield-bearing vaults built on top of ERC-20. A vault takes deposits of an underlying asset, issues share tokens representing a claim on the pool, and lets holders redeem shares for their portion of the (ideally grown) assets. ERC-4626 standardises the deposit, withdraw, and share-accounting functions so any app can integrate any vault the same way.

Before ERC-4626, every yield vault had its own interface, so wallets, aggregators, and other contracts had to custom-integrate each one. The standard removes that friction - a bit like how ERC-20 standardised tokens themselves - which is why it has become the default for on-chain vaults.

For real-world assets, ERC-4626 matters as RWAs flow into DeFi. A vault can hold a yield-bearing RWA - a tokenized fund or tokenized treasuries - and issue standardised shares, letting other protocols compose on top of that real-world yield cleanly. It is a common wrapper for "RWA-backed yield" products.

For an investor, holding an ERC-4626 vault share means your position is a claim on the vault's assets, and the standard makes it easier for tools to show your balance and value. Still, the standard describes the interface, not the safety - what the vault actually holds, and whether it is audited, is what determines the risk. A clean standard does not make a risky strategy safe.