On October 7, developers officially implemented the CIP-0113 standard for programmable tokens on the Cardano mainnet. This allows issuers to incorporate KYC/AML checks, sanctions compliance, transfer rules, and mechanisms for freezing and seizing tokens directly into the assets they issue.

Cardano’s programmable token standard, CIP-0113, is live on mainnet. Issuers of stablecoins and other regulated assets can now build compliance rules directly into native Cardano tokens. Enforced by the network itself. No hard fork required. https://t.co/J6WKo1G6bI

— Cardano Foundation (@Cardano_CF) October 7, 2026

This standard primarily targets regulated stablecoins and real-world assets (RWAs), such as funds and bonds. However, the new features do not apply to ADA or any pre-existing Cardano tokens.

“Regulators have clearly defined what is needed for tokenized financial assets. The rules must apply to the asset itself and be adhered to with every transaction. […] Programmable tokens on Cardano remain native assets on the blockchain, and compliance is guaranteed by the network itself, not by a wrapper or closed system,” stated Frederik Gregaard, CEO of the Cardano Foundation.

The programmable logic is validated with each transfer, issuance, or burning of the token, with specific rules varying by operation type. Notably, CIP-0113 does not require a hard fork; it utilizes the existing infrastructure of native Cardano assets and Plutus smart contracts.

Rules Set by Issuers

CIP-0113 establishes a general framework but does not impose a universal set of restrictions for all programmable assets. Issuers can select the modules with necessary logic or create their own. Possible scenarios mentioned by the Cardano Foundation include:

  • KYC/AML participant verification;
  • Allowed and forbidden address lists;
  • Sanction checks;
  • Jurisdictional limitations.

The reference implementation also includes a Freeze and Seize module, which enables the freezing of transfers and, under specific conditions defined in the rules, allows for forced movement or seizure of tokens.

A separate issue arises for DeFi protocols: whether a programmable token can be forcibly seized from smart contracts. According to the technical documentation, rules may prohibit its transfer, and a third-party mechanism allows for enforced actions regarding the asset.

However, the ability to seize funds from smart contracts should not be considered unconditional. The authors of the implementation note that collateral in a lending protocol, liquidity pool, or escrow may include rights of other participants. Thus, whether assets can be forcibly extracted from such contracts should be determined by the specific module.

Options for this include lists of permitted protocols or a mechanism where the smart contract must confirm the withdrawal operation itself. DeFi services must take into account the specific rules of each CIP-0113 token, including potential freezing or forced seizure, prior to accepting it as collateral or another type of asset.

Implementation Status

On September 29, CIP-0113 was added to the primary repository of Cardano Improvement Proposals. A week later, the Cardano Foundation announced the launch of the standard's implementation on the mainnet following several independent security audits.

At the time of writing, the official CIP catalog still lists the document as a proposal. Support for programmable tokens has been prepared for launch by Eternl, GeroWallet, CardanoScan, and BloxBean.

The Capital Markets and Technology Association of Switzerland recognized the CIP-0113 profile for tokenized equity securities as equivalent to CMTAT within the Tokenized Shares certification system. This enables the use of the corresponding Cardano smart contract for issuing equity securities certified to the association's standards. Recognition does not currently extend to tokenized debt instruments.

Additionally, in September, the Brazilian state-owned company Petrobras launched two research projects on Cardano to track data regarding sustainable aviation and renewable fuels.

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