Key Highlights
- On October 7, 2026, the Cardano Foundation introduced CIP-0113, a newly developed token standard.
- Issuers gain capabilities to freeze accounts, reclaim assets, and limit who can hold regulated tokens including stablecoins and investment vehicles.
- Compliance mechanisms are embedded in the blockchain itself rather than relying on external infrastructure.
- Early adopters include Eternl wallet, GeroWallet, and the CardanoScan blockchain explorer.
- The Capital Markets and Technology Association in Switzerland acknowledged CIP-0113 tokens as aligned with its on-chain securities guidelines.
The Cardano Foundation revealed a groundbreaking token framework on October 7, 2026. Designated CIP-0113, this standard is currently operational on Cardano’s primary network.
Through CIP-0113, entities that issue tokens receive unprecedented control. These authorities can halt asset movements, confiscate holdings, and determine eligibility for ownership.
This framework targets assets subject to financial regulations, encompassing stablecoins, digitized investment funds, and tokenized bonds.
Traditional cryptocurrency tokens typically transfer without restriction between any addresses. Financial institutions and asset managers face challenges with this model when complying with know-your-customer protocols and sanction requirements.
CIP-0113 addresses these compliance needs by embedding regulatory logic within the token architecture. The blockchain validates these parameters before permitting transactions.
Consider a scenario where an investment fund restricts sales to accredited participantsāthe system would reject transfers to unverified addresses. Similarly, a stablecoin provider could prevent tokens from entering wallets flagged under sanctions.
On-Chain Enforcement Mechanism
Rule enforcement operates independently of centralized control panels or third-party servers. Cardano’s distributed ledger performs validation automatically during minting, burning, and transfer operations.
Consequently, these limitations remain active regardless of the wallet software or platform a user selects. According to the Cardano Foundation, implementation proceeded without requiring a network hard fork, leveraging existing protocol capabilities.
“The rules have to travel with the asset and be enforced every time it moves,” Cardano Foundation chief executive Frederik Gregaard said in a statement.
Flexible Architecture and Early Integration
Rather than imposing a rigid compliance structure, CIP-0113 offers a foundational framework paired with interchangeable modules that issuers can tailor or update as needed.
Multiple platforms have already integrated support. Eternl and GeroWallet provide wallet compatibility, CardanoScan offers explorer functionality, and BloxBean delivers developer infrastructure.
Comparable mechanisms exist on competing networks. Ethereum’s ERC-3643 provides permissioned token functionality, Solana implements transfer restrictions via token extensions, and the XRP Ledger includes issuer-controlled freezes and clawback features.
The Capital Markets and Technology Association, a Swiss regulatory body, formally acknowledged CIP-0113 tokens. The organization confirmed these digital assets satisfy criteria equivalent to its established framework for issuing tokenized equities in Switzerland.
Work on this standard commenced in 2023. Official integration into the Cardano Improvement Proposals repository occurred on September 29, 2026, with mainnet activation following approximately one week later during the TOKEN2049 industry event.
Cardano’s unique technical architecture introduces a specific consideration. The ledger can store multiple distinct tokens within a single unspent transaction output, analogous to different currencies placed in one physical envelope.
When an issuer applies restrictions to one token in such a shared output, other assets in that same output may inadvertently become constrained. CIP-0113 resolves this through what the Foundation terms “unfracking.”
Wallet providers and decentralized finance applications must exercise caution when grouping restricted and unrestricted assets within combined outputs. The Foundation’s technical documentation advises lending protocols to examine a token’s embedded rules before accepting it as loan collateral, as certain configurations permit authorized parties to relocate tokens without owner approval.
ADA, Cardano’s native cryptocurrency, remains unaffected by these modifications and continues operating as an unrestricted transferable asset. Only tokens whose creators opt to implement CIP-0113 will carry these new limitations.
ADA’s market value decreased 4.5% in the preceding 24 hours, mirroring a wider downturn throughout cryptocurrency markets.
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