Cardano has launched a new token standard that gives issuers of regulated digital assets the ability to freeze, seize, and restrict tokens, introducing compliance controls designed to make the blockchain more suitable for banks, asset managers, and stablecoin issuers.

The Cardano Foundation announced on Oct. 7 at TOKEN2049, a major crypto industry conference, that CIP-0113 — a Cardano Improvement Proposal, the ecosystem's formal process for standardizing protocols and features — had gone live on the Cardano mainnet, the live production network where real-value transactions settle, following multiple independent security audits. The standard allows compliance rules to be enforced at the network level whenever supported tokens are transferred, minted, or burned. The full announcement is available on the Cardano Foundation blog.

The development marks a significant shift for a blockchain ecosystem commonly associated with open, permissionless transactions. The controls, however, are limited to assets issued under the new standard and do not apply to ADA, Cardano's native coin, or existing native Cardano assets.

Compliance Rules Built Into the Token

CIP-0113 enables issuers to incorporate regulatory requirements directly into Cardano-based tokens. These can include know-your-customer checks, anti-money-laundering requirements, sanctions screening, transfer restrictions, and mechanisms for freezing or seizing assets.

The defining feature of CIP-0113 is that compliance rules travel with the regulated asset itself and are enforced by the Cardano network, rather than on an external application or token wrapper.

The standard leverages Cardano's extended UTXO architecture — the unspent-transaction-output accounting model the chain uses to track balances — meaning tokens issued under CIP-0113 remain native assets. Wallets, blockchain explorers, and applications can therefore interact with them as ordinary Cardano assets, while transaction costs stay predictable.

Issuers can choose from modular compliance rules, referred to as modules, or develop their own requirements. Those rules can be updated as regulatory obligations change without requiring a hard fork or modifications to Cardano's underlying protocol. This design could allow financial institutions to adapt regulated tokens to evolving legal requirements while remaining compatible with the broader Cardano ecosystem.

Read the full announcement:

— Cardano Foundation (@Cardano_CF) October 7, 6

Freeze and Seize Controls Create a Trade-Off

The introduction of issuer-controlled restrictions creates a fundamental distinction between regulated tokens and unrestricted cryptocurrency assets. Under applicable rules, authorized parties can potentially move or restrict tokens without the holder's consent. The standard also requires lending platforms and other services to weigh such powers before accepting CIP-0113 assets as collateral.

The controls apply only to tokens issued under the standard. They do not give the Cardano Foundation authority over ADA, existing native assets, or the broader Cardano network.

Comparable approaches already exist elsewhere in the blockchain industry. Ethereum offers the ERC-3643 permissioned token framework, Solana supports transfer controls through token extensions, and the XRP Ledger provides issuer mechanisms for clawbacks and restrictions. The launch therefore places Cardano within an emerging group of blockchain networks seeking to balance decentralized infrastructure with the compliance requirements of regulated financial markets.

Institutional Tokenization Drives the Adoption Case

The institutional rationale for programmable compliance is growing as banks and financial institutions explore tokenized securities, deposits, and funds — blockchain representations of traditional financial assets. The Bank for International Settlements and the International Monetary Fund have both highlighted programmability as an important component of emerging tokenized financial markets. Embedding compliance requirements directly into digital assets could reduce the need for separate controls at every stage of a transaction.

The Swiss Capital Markets and Technology Association has recognized CIP-0113 Programmable Asset Tokens as a smart-contract equivalent to its CMTAT framework for tokenized securities. That recognition could reduce some due diligence requirements for institutions issuing securities on blockchain infrastructure.

CIP-0113 is aimed primarily at regulated asset issuers seeking blockchain-based infrastructure that combines native asset functionality with built-in compliance controls.

Cardano Expands Institutional Strategy

The launch forms part of Cardano's broader push to attract institutional financial activity. The ecosystem has already expanded access to native Cardano assets through institutional custody infrastructure provided by Fireblocks. Cardano has also participated in a Petrobras pilot focused on tracking renewable jet fuel and diesel, reflecting the network's interest in enterprise applications beyond financial assets.

Several ecosystem providers are supporting CIP-0113 at launch, including wallets Eternl and GeroWallet, blockchain explorer CardanoScan, and developer-tool provider BloxBean. The Cardano Foundation said it plans to continue working with projects and institutions and is considering additional modules, including one designed for regulated securities. If introduced, such a module would extend the standard's built-in compliance model further into tokenized securities issuance — the segment the CMTAT equivalence already addresses.

The success of CIP-0113 will ultimately depend on whether stablecoin issuers, investment funds, and regulated securities programs adopt the standard, and on whether Cardano's community accepts issuer-controlled restrictions as part of institutional tokenization.

The launch gives Cardano a native framework for regulated assets while leaving ADA and existing native tokens unaffected. Its broader significance will be determined by real-world issuance and by whether the compliance model can attract financial institutions without undermining confidence in Cardano's decentralized infrastructure.