{"id":14136,"date":"2026-10-06T10:58:55","date_gmt":"2026-10-06T10:58:55","guid":{"rendered":"https:\/\/cryptonews.uk.com\/?p=14136"},"modified":"2026-10-06T10:58:55","modified_gmt":"2026-10-06T10:58:55","slug":"cardano-just-added-the-kind-of-token-controls-wall-street-wants-and-defi-may-hate","status":"publish","type":"post","link":"https:\/\/cryptonews.uk.com\/?p=14136","title":{"rendered":"Cardano just added the kind of token controls Wall Street wants and DeFi may hate"},"content":{"rendered":"

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Cardano\u2019s proposed programmable-token standard could let a freeze on one asset temporarily block unrelated tokens held in the same transaction output.<\/p>\n

CIP-113, merged into Cardano\u2019s main improvement-proposal repository on Sept. 29, is designed to add issuer-controlled transfer rules to native assets without abandoning the network\u2019s extended unspent transaction output, or eUTXO, model.<\/p>\n

The Cardano Foundation has positioned programmable tokens as infrastructure for regulated financial assets, including stablecoins, securities and real-world assets that may require transfer restrictions, freezes and other compliance controls.<\/p>\n

The framework could therefore broaden Cardano\u2019s appeal to institutional issuers while introducing new dependencies for wallets and DeFi applications when several assets share the same output.<\/p>\n

However, the milestone stops short of full activation. CIP-113\u2019s official page still lists the proposal as \u201cProposed,\u201d with its path to Active requiring issuance on Preview and mainnet, end-to-end testing and support from a widely adopted wallet.<\/p>\n

Still, Matteo Coppola, chief executive officer of Fluid Tokens and a contributor to CIP-113, hailed the milestone, saying the merge followed years of development and puts the framework in Cardano projects’ hands.<\/p>\n

\u201cThis means the official standard for programmable tokens on Cardano, including securities, is out,\u201d Coppola said, adding that contributors had worked to make it production-ready.<\/p>\n

Compliance rules can spill across a shared output<\/h2>\n

That institutional flexibility comes with a structural complication: on Cardano, the rules governing one programmable token can affect other assets bundled alongside it.<\/p>\n

Under the eUTXO model, a transaction output can contain several tokens as well as ADA. Spending that output consumes it as a unit, so a restriction attached to one programmable asset can determine whether the entire transaction goes through.<\/p>\n

If an output contains restricted token A, unrelated token B, and ADA, for example, a freeze or denylist rule on A can prevent the holder from spending that output to move B. Neither B nor the ADA has been independently frozen, but both become temporarily inaccessible because they share the same output with A.<\/p>\n

CIP-113 provides a way to break that dependency through a restructuring mechanism known as \u201cunfracking.\u201d<\/p>\n

The process allows one token policy to be separated from the rest of an output without changing ownership. If the transaction is permitted, A can be moved into its own output while B remains in another output controlled by the same holder. A stays restricted, while B is no longer subject to A\u2019s transfer rule on a subsequent spend.<\/p>\n

However, the holder does not automatically control the ability to separate the assets.<\/p>\n

\"Hypothetical\"Hypothetical<\/p>\n

An unfracking transaction requires the holder\u2019s authorization and must also satisfy the affected token\u2019s registered separation rules. Those rules can require an additional signature, impose conditions through a script, or block the restructuring route entirely.<\/p>\n