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ERC-1400 is a set of proposed smart contract standards that extend the functionality of ERC-20 tokens. It introduces additional functions and events to support the unique requirements of security tokens, such as transfer restrictions and controller operations.

ERC-1400 Deep Dive

The Real-World Asset (RWA) tokenization market could reach $16 trillion by 2030,
representing 10% of the global GDP.

With the current forecast of tokenized digital securities standing at $4 trillion to $5 trillion, the tokenization of financial instruments opens up new opportunities to enhance market efficiency, to increase liquidity and to expand investment possibilities.

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The ERC-1400 report is a deep dive into the ERC-1400 token standard for tokenizing real-world assets (RWAs) financial instruments such as equity, private credit, treasuries, real estate funds, etc. in a compliant and regulated manner on Ethereum and EVM-compatible networks.

This comprehensive report, produced in collaboration with industry experts such as Talium, DigiShares, Hacken, Kaleido and RWA World, features insights and case studies from industry experts, clarifying the mechanics, challenges, and opportunities of the ERC-1400 standard. 

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Source: Money, Tokens and Game, Citi Group (2023)

Demystifying ERC-1400

The ERC-1400 standard was created to address the lack of standardization in creating, issuing, and managing security tokens on Ethereum and EVM-compatible networks.

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It has evolved into an umbrella for ERC-1410 (Partially Fungible Token Standard), ERC-1594 (Core Security Token Standard), ERC-1643 (Document Management Standard), and ERC-1644 (Controller Token Operation Standard) to improve adoption by decomposing the security token standard into a library of related and interoperable standards, making the implementation more flexible and adaptable to different use cases.

 

Key takeaways:
 

  • Security Tokenization: Specifically designed for the tokenization of securities, ERC-1400 accommodates multiple asset classes and partitions, allowing for the representation of different share classes within a single token structure.

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  • Standardized Compliance and Identity Management: ERC-1400 enables compliance through flexible on-chain and off-chain transfer restrictions. It supports identity management integration with existing systems, enabling verification of investor eligibility and compliance with KYC/AML regulations.

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  • Transferability Rules and Compliance: Features robust transferability rules that incorporate both on-chain and off-chain data. Enables the use of off-chain authorization, ensuring that transfers comply with legal and contractual obligations. Any transferability rule can be implemented (including complex, confidential and upgradable).
     

  •  Document Management: Incorporates ERC-1643 for managing documents associated with tokens, ensuring that legal and regulatory documents are securely linked to the token, enhancing transparency and trust.
     

  • Interoperability and Compatibility: Ensures seamless interaction with existing Ethereum standards such as ERC-20, ERC-165, ERC-173, and ERC-725. It is designed to be compatible with current wallets, exchanges, and tools within the Ethereum ecosystem.
     

ACCESS THE ERC-1400 DEEP DIVE REPORT

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Learn how ERC-1400 contributes to enabling secure and compliant digital securities.

 

This report demystifies the technical facets and showcases its potential strategic advantages to the financial services industry.  Companies that have contributed their expertise and insights include Talium, DigiShares, Hacken, Kaleido and RWA World.
 

Discover the Framework: Learn the structure and functionality of ERC-1400.


Strategic Adoption: Explore how to implement ERC-1400 within your asset tokenization strategies.


Future-Proof Your Operations: Understand the implications of adopting the ERC-1400 and how it can help with compliance and market competitiveness.
 

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