Asset Custody Requirements

Asset custody requirements are the protocols and standards for securely holding the physical or financial assets that back digital tokens. Because the token is only as valuable as the underlying asset, the custody solution must be highly secure, transparent, and legally sound.

This often involves using professional third-party custodians, multi-signature wallets, or regulated financial institutions to hold the assets. The custody arrangement must provide proof of existence and ensure that the assets cannot be seized or misused.

Requirements include regular audits, insurance coverage, and clear legal procedures for asset recovery. For Real World Assets, the physical security of the asset, such as gold in a vault or real estate deeds, is just as important as the digital security.

Meeting these requirements is a prerequisite for institutional participation and building trust in the tokenized asset ecosystem.