The ERC-4626 tokenized vault standard is a standard protocol for tokenized vaults and is built on the ERC-20 token standard. The standard was created to unify the technical parameters of yield-bearing vaults, making development, integration, and interoperability easier for vaults. It is meant to consolidate and standardize development efforts around “ERC-20 token strategies” such as borrowing & lending, farming, and staking. ^[1][3]

Overview

The Tokenized Vault Standard, ERC-4626 officially went live on March 18, 2022^[2]. The Ethereum Comment Proposal 4626 for the ERC-4626 standard was created by Joey Santoro^[9] — founder of Fei Protocol, who partnered with Ethereum developers transmissions11^[4], Jet Jadeja^[5], Alberto Cuesta Cañada^[6], and Señor Doggo^[7].

ERC-4626's Purpose

The lack of standardization for tokenized vaults presents challenges in integration and composability. Without a standard implementation, protocols must create their own adapters for lending markets, aggregators, and other interest-bearing tokens, resulting in errors, increased attack risks, and wasted development resources. Establishing a standard for tokenized vaults would streamline integration efforts, leading to more consistent and secure implementation patterns.^[3]

ERC-4626 was developed with the goal of creating a standard that enhances composability and interoperability. To simplify the integration of yield-bearing tokens and address vulnerabilities, the team opted for a scalable and user-friendly approach. ^[8]

4626 Alliance

The 4626 Alliance is a group of leading protocols and applications that share the mission of supporting the development and deployment ofERC-4626 vaults:

The Alliance group was created to foster collaboration between DeFi projects and push the adoption of the ERC-4626 standard. Members of the 4626 Alliance establish a common bounty board for “4626 essentials.” They are voted on/built individually/jointly by members of the Alliance. ^[10][11]

The Alliance Group also funds a common vehicle to distribute the costs and outsource through bounties the development of these “4626 essentials.” Each member of the Alliance commits $3k or more for this purpose. Alliances are also responsible for promoting the ERC-4626 standard through publication and events, and lastly, they create and maintain an open-source ERC-4626 resource library. ^[10]

Members of the 4626 Alliance include:

• Alchemix
• Aztec
• Balancer
• Beefy Finance
• Blockworks
• Frax Finance
• Morpho
• Mstable
• PoolTogether
• Sommelier Finance
• Superform
• Yearn