How ERC4626 ( tokenized vault standard) is going to push DeFi to the next Phase
A thread ๐งต ๐
A thread ๐งต ๐
๐งต1/10
- At Least some people might have heard of the term ERC-4626 or EIP-4626 from the @iearnfinance tweet or from somewhere else.
- What are those, how ERC-4626 can be a game-changer for the DeFi space?
- At Least some people might have heard of the term ERC-4626 or EIP-4626 from the @iearnfinance tweet or from somewhere else.
- What are those, how ERC-4626 can be a game-changer for the DeFi space?
๐งต2/10
I will try to explain in Layman's terms.
- ERC-4626 is a new token standard put forward by the Ethereum Improvement Proposals (EIP).
- EIP is a standard specifying new features or processes for Ethereum.
I will try to explain in Layman's terms.
- ERC-4626 is a new token standard put forward by the Ethereum Improvement Proposals (EIP).
- EIP is a standard specifying new features or processes for Ethereum.
๐งต3/10
What is this new standard? Let's take a look.
- We know projects like #aave( borrowers are paying interest to lenders),@SushiSwap( trading fees as the income), or aggregators like @iearnfinance or @RariCapital vaults.
What is this new standard? Let's take a look.
- We know projects like #aave( borrowers are paying interest to lenders),@SushiSwap( trading fees as the income), or aggregators like @iearnfinance or @RariCapital vaults.
๐งต4/10
- All these projects are serving almost similar purpose with different interfaces without any standardization.
- All these projects are serving almost similar purpose with different interfaces without any standardization.
๐งต5/10
- New EIP- 4626 AKA ERC-4626 proposes the standardization of yield-bearing tokens like the above mentioned.
- Also called the tokenized vault standard.
-This new standard took a final shape last month.
-What is its use? how does it improve the DeFi? I'll explain.
- New EIP- 4626 AKA ERC-4626 proposes the standardization of yield-bearing tokens like the above mentioned.
- Also called the tokenized vault standard.
-This new standard took a final shape last month.
-What is its use? how does it improve the DeFi? I'll explain.
๐งต6/10
- Before that we need to know what are the flaws in the existing DeFi system.
- Currently, devs are writing separate codes for different projects and spend a lot of money to audit the code for any vulnerabilities.
- This leads to inefficiency and compromise security.
- Before that we need to know what are the flaws in the existing DeFi system.
- Currently, devs are writing separate codes for different projects and spend a lot of money to audit the code for any vulnerabilities.
- This leads to inefficiency and compromise security.
๐งต7/10
WHAT IS DIFFERENT NOW
- Main proposal is the standardization of vaults, improved efficiency and security.
- A standard for tokenized Vaults will lower the integration effort for yield-bearing vaults.
-It will create more consistent and robust implementation patterns.
WHAT IS DIFFERENT NOW
- Main proposal is the standardization of vaults, improved efficiency and security.
- A standard for tokenized Vaults will lower the integration effort for yield-bearing vaults.
-It will create more consistent and robust implementation patterns.
๐งต8/10
WHAT ARE THE ADVANTAGES
- The main advantage is any app built on ERC-4626 will work on any ERC-4626 token.
- Devs can build directly in this standard so that they can avoid wrapped tokens that require gas to wrap and unwrap.
WHAT ARE THE ADVANTAGES
- The main advantage is any app built on ERC-4626 will work on any ERC-4626 token.
- Devs can build directly in this standard so that they can avoid wrapped tokens that require gas to wrap and unwrap.
๐งต9/10
- Possibility of interoperability between different protocols in different chains.
- Possibility of interoperability between different protocols in different chains.
๐งต10/10
- Within a month of the announcement, a lot of projects like Yearn Finance, Balancer, Rari Capital, and mStable are using the new standard in their vaults.
-This is going to be the gold standard for DeFi and going to revolutionize it.
- Within a month of the announcement, a lot of projects like Yearn Finance, Balancer, Rari Capital, and mStable are using the new standard in their vaults.
-This is going to be the gold standard for DeFi and going to revolutionize it.
-This is going to be the gold standard for DeFi and going to revolutionize it.
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