Kadena, a popular public L1 blockchain that uses chain web architecture for Defi protocol deployment, RWA tokenization, and AI-driven application integration, has published a new report examining RWA tokenization standards. In its report, Kadena classifies ERC-3643 as the top compliance standard for real-world asset (RWA) tokenization.
Additionally, the report highlights the key requirements for efficient and compliant protocols while financial institutions adopt blockchain technology for tokenization of their assets.
ERC-3643 has emerged as the top compliance standard for compliant RWA tokenization, says Kadena Report
Kadena’s report highlights a paradigm shift from the traditional ERC-721 and ERC-20 standards. This lacks the compliance capabilities required by the agency. Therefore, institutional players have overwhelmingly embraced the ERC-3643 standard when it comes to actual asset (RWA) tokenization. Each standard provides compliant RWA tokenization, as it incorporates AML/KYC checks.
In the report, the platform mentioned the widespread use of ERC-3643 in driving more than $32.2 billion across tokenized assets. Therefore, the platform predicts that by 2030, led primarily by agencies adopting compliance-first infrastructure, the tokenized asset sector will jump to the $2030 $11T range. In particular, Kadena founder Stuart Popejoy advocated the importance of compliance in institutional adoption and the important role of standards such as ERC-3643.
Kadena reflects the new RWA token standard ERC-3643 backed by $25 million
Separately, Cadena is developing another Real World Asset (RWA) token standard by leveraging parallel chain architectures and agreements’ smart contract languages. Boasted by a large $25 million fund, the token standard prioritizes security and scalability. Additionally, the new token standard also reflects the compliance capabilities of the ERC-3643, and a real estate fund named “CurveBlock” has already been adopted.
According to a Kadena report, the ERC-3643 is the ideal standard for compliance-enabled RWA tokenization. Amid the rapid expansion of the RWA world, agencies are flocking to this sector, but focusing on compliance to operate safely. The report concludes that compliance-driven standards provide critical infrastructure to drive the institutional finance future in blockchain.
Interview session
To dive deeper into the report and explore Cadena’s perspective, we contacted Annelies Osborne, Cadena’s Chief Business Officer. Annelise Osborne discussed the expanding role of REC-3643 in real-world asset (RWA) tokenization. The following interview questions describe Cadena’s core objectives, compliance, adoption, and tokenization efforts.
Q. Thanks for your feedback, why does ERC-3643 make more efficient and better options than the ERC-20 and ERC-721 RWA tokenization?
Ans. We all had to start somewhere, somewhere, and somewhere were the token standard ERC-20 and ERC-721 on the Ethereum blockchain. The ERC-20 is the basic layer of all kinds of tokens. ERC-721 will soon be coming out and focuses on inappropriate tokens (NFTs) to represent individual assets, such as ART, collectible, or specific assets. As innovation grows, think of the ERC 3643 as an ERC-20 token created with functionality incorporating its functionality and built for securities. Standards include permit and regulatory compliance.
ERC-3643 directly integrates KYC/AML verification, investor certification checks, jurisdiction-specific restrictions and more into token agreements. Standard embedded compliance is extremely beneficial from an institutional perspective. The ERC-3643 provides this. Blockchain is not just tokenized. A more efficient capital market is faster, lower costs, and safer.
Q. How important is compliance to bridge facility giants into RWA tokenization?
Ans. Regulations are being put in place to protect investors and maintain an efficient market. Compliance is a kind of necessary evil to ensure that bad actors do not participate. Yes, compliance is paramount when it comes to institutional recruitment. That said, regulatory clarity is required within the US to allow institutions to participate using digital assets. Clear black and white guidelines are required. Financial companies know better than playing in grey. Trustees who manage trillions of dollars take regulatory risks.
I think the global regulatory momentum is exciting. Parker has built this incredible technology, but now you need a suit with compliance expertise. Both sides of the table are needed to successfully bridge that gap and see full adoption
Q. How is Kadena’s RWA tokenization criteria superior to others?
Ans. I think what sets Cadena apart is that we were built by people who understand both sides of the equation. Our founder came from JPMorgan. They created JPM’s first blockchain innovation lab and worked on early JPMorgan Coins. So from day one, they understand that if they want to strengthen global finance, they need innovative and in-house infrastructure.
The RWA token standard is based on the widely recognized ERC-3643 protocol. But here’s what I really think is important – we’re not just symbolic for tokenization. These markets solve real liquidity and accessibility issues.
Another work is scalability and security. We use proof of work that has been proven to be extremely safe. I’ve been hacking recently and the system hasn’t gone down. However, unlike Bitcoin, our energy consumption is distributed across the web of the chain, so we get its security without environmental concerns. When you’re talking about the trillion dollar market, you need an infrastructure that won’t succumb to under pressure.
Q. With Kadena’s efforts in mind, what other factors are needed to drive RWA tokenization market value by 2030?
Ans. Beyond what we’re building in both the ecosystem and in Cadena, there are actually three key factors. The first is clarity of regulations. And I mean true clarity, not just the institution’s guess. Black and white rules are required across major jurisdictions. The US is becoming much more open this year to innovation and regulatory clarity, which is encouraging. Kadena spoke to DC during Crypto Week’s discussions on the Genius AC and the Market Clarity Act. We are involved in both the Global Blockchain Business Council and the Digital Chamber, making our voices heard in Washington, DC and beyond. There will also be projects with regulators outside the US that will be announced soon.
The second is education. I wrote “From Parkers to Suits” simply because there are no accessible resources to explain how this technology applies to the capital market. To understand the benefits that blockchain can bring, it requires business leaders, regulators and the general population. It’s not about the confusion, it’s about upgrading your financial infrastructure.
The third factor is interoperability. Both are connecting financial systems to blockchain and standards within the blockchain and crypto ecosystem. Without a seamless connection between all the key parts of the infrastructure, a market like Crypto is at risk that it was before the bridge and wrapped tokens. You need a pipe to connect everything.
That said, I think we are at a turning point. When you see BlackRock launching Buidl, JPMorgan processing hundreds of billions through Onyx, and seeing major institutions become accustomed to technology, you see it’s moving beyond the experimental stage. Market forecasts of $2-30 trillion is not a hype. We recognize that tokenization is the next technology upgrade in finance, providing opportunities to reduce costs and increase revenue. I won’t talk about blockchain right away, but I would like to thank a more efficient capital market.
