TLDR The Cardano Foundation activated CIP-0113, a compliance-oriented token protocol, on October 7, 2026. Issuers of regulated digital instruments can now freeze balances, reclaim assets, and
On October 7, 2026, the Cardano Foundation revealed the activation of CIP-0113, a protocol specification now operational on Cardano’s production network.
Cardano tokens can now be frozen, says the Cardano Foundation.
Its new CIP-0113 standard lets issuers of stablecoins, funds and bonds on $ADA block, freeze or seize holdings when the rules require it.
Like this post. It's the only thing on Cardano they can't seize. pic.twitter.com/lLi4WTLKjV
— Altcoin Buzz (@Altcoinbuzzio) October 7, 2026
CIP-0113 equips asset issuers with administrative capabilities: the ability to halt token movements, confiscate balances, and define eligible counterparties for transactions.
The protocol targets instruments subject to financial regulation, such as fiat-pegged stablecoins, tokenized investment vehicles, and digitized debt securities.
Traditional cryptocurrency tokens permit unrestricted peer-to-peer transfers. This design conflicts with legal obligations faced by financial institutions, which must verify identities and enforce sanctions compliance.
CIP-0113 embeds compliance logic within the token architecture itself. Cardano’s consensus layer validates these embedded policies before finalizing any transaction.
Consider a tokenized fund restricted to accredited investors: the protocol could reject a transfer attempt to a wallet address that hasn’t completed verification. Similarly, a stablecoin issuer might prevent tokens from entering addresses flagged under sanctions regimes.
The validation mechanism does not rely on centralized control panels or off-chain servers. Cardano’s distributed ledger evaluates compliance rules at every minting, burning, or transfer event.
This architecture ensures restrictions remain effective regardless of the wallet software or exchange platform a holder chooses. According to the Foundation, deployment occurred without a network hard fork, leveraging functionality already present in Cardano’s protocol.
“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.
CIP-0113 employs a modular architecture rather than a rigid rulebook. A foundational standard combines with interchangeable policy modules that issuers can update or replace as requirements evolve.
Multiple platforms have integrated support for the specification. Wallet providers Eternl and GeroWallet, blockchain indexing service CardanoScan, and developer infrastructure firm BloxBean have all implemented compatibility.
Comparable capabilities exist on competing networks. Ethereum’s ERC-3643 offers permissioned token functionality, Solana provides transfer hooks through its token extensions program, and the XRP Ledger enables issuer-controlled freezing and balance recovery.
The Capital Markets and Technology Association, a Swiss financial standards body, formally acknowledged CIP-0113 tokens. The organization stated these assets satisfy criteria equivalent to its guidelines for issuing tokenized equity instruments in Switzerland.
Work on the specification commenced in 2023. It received formal approval in the Cardano Improvement Proposals repository on September 29, 2026, and became operational on mainnet approximately one week afterward during the TOKEN2049 industry event.
Cardano’s native architecture introduces a unique consideration. The ledger’s UTXO model permits multiple token types to coexist within a single transaction output, analogous to different bills sharing a physical wallet.
When an issuer applies restrictions to one token within such a bundled output, other assets in the same output could inadvertently become affected. CIP-0113 mitigates this through a process the Foundation describes as “unfracking.”
Wallet software and decentralized finance protocols must exercise care when combining restricted and unrestricted tokens in shared outputs. The Foundation’s technical documentation advises lending platforms to examine a token’s embedded policies before accepting it as loan collateral, given that certain rule configurations permit authorized entities to relocate tokens without holder authorization.
ADA, Cardano’s native cryptocurrency, remains unaffected by these protocol additions and continues to function as a permissionless transferable asset. Only tokens whose issuers voluntarily implement CIP-0113 will carry the new control mechanisms.
ADA’s market value decreased 4.5% in the preceding 24-hour period, consistent with widespread downward movement across cryptocurrency markets.
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