Defactor
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Guide · Basics

How does it stay compliant?

Every token carries eligibility, transfer rules and an audit trail.

Basics5 min read

Compliance on Defactor isn't a manual review step — it's built into every asset. Each token carries its own eligibility rules, transfer restrictions and audit trail, so it stays compliant wherever it goes.

This guide explains the three things that travel with every token and how they keep deals compliant automatically.

The mechanism

Rules that live inside the token

Traditional compliance checks happen around an asset — before a trade, after a transfer, in a separate system. Defactor puts the rules inside the asset itself.

That means compliance is enforced at the moment of every transfer, not reconstructed later. A non-compliant transfer simply can't complete.

What travels with every token

The three built-in guarantees

Eligibility
Only verified, approved holders can receive the token — enforced automatically.
Transfer rules
Region and deal-specific rules block non-compliant transfers by design.
Audit trail
Every movement is recorded, so holder registers and audit packs are always current.
The payoff

Verify once, stay compliant everywhere

Because the rules and records travel with the asset, participants verify once and reuse that verification across every eligible deal.

For operators and issuers, this turns compliance from a recurring cost into a one-time setup that keeps enforcing itself.

Tip. Even as a token moves between products — issued in Mint, distributed through Yield — its eligibility rules and audit trail move with it.
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