ICON (ICX) Creates New Token Standard for Tokenizing Assets, Compliant with Regulations
On Friday, March 8, ICON reports in a Medium article that it has launched token specifications for market participants who wish to develop DLT-based securities and tokenized physical assets.
ICON’s new token base
ICON has added a new IRC16 standard founded on the platform’s public blockchain. It will enable developers to create tokenize securities and assets, making the whole process transparent.
IRC16 uses a modular architecture for tokenizing physical assets. When ready, they will be compliant with the rules set up by regulators regarding blockchain transactions and owning digital assets.
Why tokenize assets?
When physical assets are tokenized, it enables owners to divide their ownership and prove it. Also, this technology helps ‘turning’ physical assets into smaller ‘pieces’ (tokens), thus making them more liquid. Besides, it allows for broadening the number of investors in the long run.
Smart contracts, which are also used here, will guarantee that sellers and buyers of assets will carry out their part of the deal, as well as will bring down brokerage charges.
Yuri MolchanHow IRC16 complies with regulatory rules
The IRC16 standard is closely focused on complying with regulatory rules, thus it has several functions for working with tokens, their emittance, etc.
The special function ‘Check for Token Transfer’ allows verifying if senders and receivers of tokens have passed KYC and AML control measures. It also cuts down the number of investors who can send or receive tokens.
The ‘Token Control by Operator’ feature is in charge of complying with regulatory rules related to fraud or when holders lose their private keys to wallets with digital assets.
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