RWA Tokenisation - things to consider

• Which standard to use?
  • ERC-1400 Security Token Standard
  • ERC‑3643 RWA standard

Key Lifecycle steps

1. Asset Identification & Due Diligence
   • Validate ownership, title authenticity, legal status, provenance, and accurate asset appraisal before tokenization begins, counterparty legitimacy
2. Token Design & Legal Framework
   • ERC-1400, ERC‑3643
   • Encode investor rights, transfer restrictions, and regulatory conditions into the smart contract/legal wrapper.
3. Token Generation & Issuance
   • Convert into tokens representing fractional or full ownership with on-chain/off-chain linkage and reserve mechanisms if needed.
4. Onboarding and distribution
   • Conduct KYC/AML checks before issuance, data compliance
   • embed compliance logic into onboarding and token transfer workflows
   • ensure eligibility of investors, disclosure and offering rules, trading venue licensing
5. Ongoing Servicing & Compliance Monitoring
   • Maintain transparency on asset performance
   • Provenance of appraisal, oracle price feeds, and periodic revaluation to avoid stale or incorrect valuation assumptions
   • financial reporting
   • underlying asset servicing (e.g., rent or yield collection)
   • regular audits, and investor disclosures
6. Lifecycle governance and reporting
   • keep detailed transaction logs, audits, supply chain tracking, and smart contract versioning

Key ERCs

• Token standards (ERC-20, ERC-721, ERC-1400, ERC‑3643)

ERC‑1400 (Security Token Standard)

• Transfer Restrictions: Conditional transfers validated via canSend() logic or off-chain certificates to enforce KYC/AML and investor eligibility. Transfer validation via canTransfer()
• Partitioned Ownership (Tranches): Through ERC‑1410, supports segmented ownership with custom rights per tranche—e.g. Class A vs. B shares
• Document Management (ERC‑1643): Associates on-chain links to legal documents/offers with metadata and timestamps for auditability
• Controller Operations (ERC‑1644): Allows designated controllers to forcibly transfer or revoke tokens—useful for compliance enforcement in cases like KYC failure or legal orders
• Role-based access (issuers, controllers)
• Interoperability & Upgradability: Fully ERC‑20 compatible and employs proxy-based upgrade logic (ERC‑1820, etc.) for lifecycle evolution