# Redeeming Claim Tokens

When a deposit is made, claim tokens are minted in a 1:1 ratio to the amount of collateral deposited. At the beginning of every new epoch, ERC1155 claim tokens are converted into ERC4626 vault shares in an amount determined by the vault's current price per share.

{% hint style="info" %}
If there are 100 claim tokens for the current epoch are in circulation, and 1000 vault shares are issued. The resulting price per share for the current epoch will be 10 vault shares / claim token.
{% endhint %}

### Vault Shares

A vault share represents a proporational amount of collateral assets and option contracts underwritten by the vault. Claim tokens minted in a given epoch may be exchanged for vault shares in any subsequent epoch.

{% hint style="info" %}
If a claim token is minted in epoch 1, the user must wait until epoch 2 before exchanging claim tokens for vault shares.
{% endhint %}

Claim tokens are automatically converted to vault shares on behalf of the user each time a user interacts with the vault (i.e. deposits, withdraws, or redeems). This prevents the accumulation of a large number of claim tokens (which by design are temporary).


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