Platform · Tokenised Custody
Tokenised custody. Every asset owned directly. Every holding verifiable.
The Problem with Traditional Custody
Traditional custody has a transparency problem. When an investor holds assets through a platform or a managed fund, they typically own a unit in a pooled structure — not the underlying asset itself. The custodian holds the assets, the platform holds the record, and the investor holds a claim against both. Settlement takes days. Verification requires asking someone. And in a dispute, the chain of title is a matter of contractual interpretation, not mathematical proof.
Tokenised custody changes this. Each asset is purchased and held in institutional custody, then represented as a regulated digital token — individually owned by the client, not pooled with anyone else's holdings. Ownership, backing, and compliance are enforced by the token contract itself, and verifiable on-chain at any time.
Direct Ownership
When a client acquires a Nexfolio token, they are acquiring a direct, individual claim on a specific underlying asset — an ETF unit, a managed fund holding, or an equity — held in institutional custody on their behalf. There are no pooled units. There is no intermediary holding a unitised interest on behalf of a group.
The 1:1 backing between token and underlying asset is not self-reported by Nexfolio. It is verified continuously by an independent on-chain oracle — publicly readable at any time. Every token in circulation corresponds to an identified, held asset in custody. This is the 1:1 backing requirement under the Corporations Amendment (Digital Assets Framework) Bill 2025.
ERC-3643
Compliance enforced at the contract level
ERC-3643 is the international standard for regulated security tokens — also known as T-REX. What it does is embed compliance into the token itself. Every wallet that holds or receives a Nexfolio token must have passed KYC and AML verification. The contract checks this on every transfer. A non-verified wallet cannot receive a token, regardless of instruction — not from the adviser, not from the platform, not from anyone.
This means compliance is not a process running alongside the token. It is the token. There is no separate compliance layer to bypass, no manual override, no exception handling. The transfer either executes — because both wallets are verified — or it does not.
Issuer Key Security
No single point of control
Nexfolio's token minting and redemption functions are protected by a 2-of-3 threshold signing arrangement. The keys that authorise the creation and cancellation of tokens are split across three independent signers — no single person or system can issue or burn tokens unilaterally. Every minting and redemption operation requires independent co-authorisation, creating a complete and tamper-evident audit trail of every token lifecycle event.
Proof of Reserve
Independently attested 1:1 backing
Proof of Reserve is the mechanism that keeps the 1:1 backing honest. An independent oracle monitors Nexfolio's custody holdings and publishes an on-chain attestation that every token in circulation is matched by a held asset in institutional custody. This attestation is public and queryable at any time — not a periodic report issued by Nexfolio, but a continuously maintained on-chain record.
The result is that the backing of any Nexfolio token can be verified by any party — the client, their adviser, a regulator, or an auditor — without asking Nexfolio anything. The oracle confirms it independently.
Lost token. Asset protected.
With unregulated crypto tokens, a lost wallet means a lost asset — permanently and with no recourse. Nexfolio tokens work differently. Because every token is issued to a verified, identity-linked wallet, Nexfolio always knows who the beneficial owner of each token is. If a client's wallet is lost or compromised, the token can be cancelled and reissued into a new verified wallet. The underlying asset — held in institutional custody — is never at risk. This is a direct consequence of the ERC-3643 compliance architecture, not a workaround on top of it.
Regulatory Framework
Nexfolio is designed and built to the standards of a Tokenised Custody Platform (TCP) under the Corporations Amendment (Digital Assets Framework) Bill 2025. The three statutory requirements that define a TCP — factual control of the digital token (s761GB), 1:1 asset backing (s761GD), and express accountability for custodian agent actions (s761GE) — are all implemented in working software and have been demonstrated to the required standard.
Nexfolio has applied for an Australian Financial Services Licence (AFSL) with the intention of operating as a TCP.
Full regulatory detail →Blueprint
Download the Tokenisation Methodology Brief
Want to understand the technical and regulatory architecture in detail? Download the Nexfolio Tokenised Custody Methodology Brief — a technical overview of the TCP framework, ERC-3643 implementation, and Proof of Reserve architecture.
Request the Methodology Brief →