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packages/nextjs/guides/erc-4626-vaults.md

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- **Security hinges on `totalAssets()`**: it drives pricing for `convertToShares`/`convertToAssets`.
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- **Top risks**: first-depositor inflation, reentrancy, fee-on-transfer/rebasing tokens, oracle manipulation, rounding drift.
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- **Custom features** (fees, caps, queues, RBAC) add complexity. Design cautiously, test heavily.
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- **Build with audited libs**, implement CEI + reentrancy guards, and write invariants/fuzz tests.
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- **Build with audited libs**, implement CEI + reentrancy guards (see [OpenZeppelin ReentrancyGuard](https://docs.openzeppelin.com/contracts/5.x/api/security#ReentrancyGuard)), and write invariants/fuzz tests.
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## 1. What Is ERC4626?
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ERC4626 (Tokenized Vault Standard) unifies how vaults issue transferable “shares” representing a proportional claim on underlying assets. This makes integrations easier across DeFi.
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[ERC4626](https://eips.ethereum.org/EIPS/eip-4626) (Tokenized Vault Standard) unifies how vaults issue transferable “shares” representing a proportional claim on underlying assets. This makes integrations easier across DeFi.
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Core interface highlights:
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- **Rounding discipline** (favor vault; multiply then divide)
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- **Admin safety** (RBAC + multisig + timelocks)
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- **Comprehensive tests** (unit, fuzz, invariants, integration)
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- **Use `SafeERC20`** for transfers; validate return values consistently
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- **Use `SafeERC20`** for transfers (from [OpenZeppelin SafeERC20](https://docs.openzeppelin.com/contracts/5.x/api/token/erc20#SafeERC20)) and validate return values consistently
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- **Follow EIP-4626 rounding guidance** (conservative rounding that favors the vault)
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