Tokenization Protocol
Purpose
The protocol defines a method for representing a property's economic rights with digital tokens.
Key challenges it addresses include:
- Establishing clear governance and ownership records for tokenized interests.
- Supporting clear distribution and servicing records across the lifecycle.
- Maintaining legal compliance across diverse jurisdictions a16z crypto.
The flow models how user requests, ownership records, and servicing events move through logical entities or modules while preserving traceability.
Step-by-Step Breakdown
FRONTENDS
These are the user-facing interfaces or entry points into the protocol, including web or mobile interfaces, SDKs, or APIs. Users initiate actions here, such as reviewing a fund, subscribing, or requesting a servicing action. Role: Present approved actions and record the request context.
REGISTRY
This layer logs and validates requests from frontends. It acts as a gateway, ensuring frontends are authenticated, registered, and compliant before passing the requests along. Role: Track registered frontends and route validated calls.
APPLICATION
Refers to the core logic or smart contract module that processes operations such as issuance, ownership updates, compliance checks, and servicing. Role: Execute the applicable business logic and record the resulting state.
RECORDS AND CONTROLS
A dedicated contract or module can record ownership, transaction, and lifecycle events. It centralizes accounting and audit evidence for the applicable operation. Role: Maintain traceable records and enforce the controls defined by the contract and fund terms.
CURATORS
Operating controls that help review or direct permitted lifecycle actions under the applicable governance and legal documents. Role: Act as stewards of controlled decisions and preserve the evidence for each action.
USERS
Includes Investors, Issuers, Administrators, Operators, and token holders who use or receive the results of the applicable workflow. Role: Provide required inputs, exercise permitted rights, and receive the recorded outcome.
Request Flow
- Frontends collect the request and user context.
- Registry validates and routes the request.
- The Application executes the applicable operation.
- Records and Controls maintain the resulting ownership, transaction, and lifecycle evidence.
- Curators review controlled actions when the governing process requires it.
- The recorded result reaches the relevant Users and token holders.
This architecture supports traceable requests, controlled ownership records, and accountable servicing across the tokenization lifecycle.