ERC-1400: The Ethereum Security Token Standard
ERC-1400 was the first comprehensive Ethereum standard designed for security tokens — adding the compliance layer (transfer restrictions, forced transfers, document attachments) that ERC-20 lacks. Its successor ERC-3643 (T-REX) has become more widely adopted, but ERC-1400 established the conceptual framework.
Definition
ERC-1400 is an Ethereum Improvement Proposal (EIP) defining a set of interfaces for security tokens on the Ethereum blockchain. Developed by Polymath and submitted to the Ethereum community in 2018, ERC-1400 extends ERC-20 (the basic fungible token standard) with functionalities required for regulatory compliance in securities contexts.
ERC-1400 is actually a composite standard comprising several sub-standards:
- ERC-1410: Partially fungible tokens — tokens divisible into “partitions” with different attributes
- ERC-1594: Core security token functionality — transfer restrictions with reasons, forced transfers
- ERC-1643: Document management — attaching legal documents (prospectus, subscription agreements) to tokens
- ERC-1644: Controller operations — enabling authorized controllers (regulators, custodians) to force transfers or redemptions
Key Features
Transfer restrictions: ERC-1400 introduces canTransfer() and canTransferFrom() functions that check whether a proposed transfer is compliant before allowing it to execute. The check can be delegated to an off-chain service or on-chain whitelist. Transfer restriction reasons can be returned — enabling smart contracts to explain why a transfer was blocked.
Forced transfers: The controllerTransfer() function enables authorized controllers to transfer tokens without the current holder’s consent. This enables: legal enforcement of court orders, correction of erroneous transfers, regulatory seizure orders, and corporate actions (mergers, redemptions) that require forced movement of securities.
Document attachment: setDocument() and getDocument() functions enable the attachment of off-chain or on-chain legal documents — prospectuses, subscription agreements, shareholder resolutions — to the token contract, creating a link between the on-chain instrument and its legal documentation.
Partitions: ERC-1410 sub-standard enables tokens of the same contract to exist in multiple “partitions” with different attributes — enabling preferred vs. common shares, locked vs. unlocked employee stock, or different classes of fund units within a single token contract.
ERC-1400 vs. ERC-3643 (T-REX)
ERC-1400 and ERC-3643 (T-REX, the Token for Regulated Exchanges standard) address the same compliance challenge — adding securities compliance functionality to ERC-20 — but with different architectural approaches.
ERC-1400 embeds compliance logic within the token contract itself. The transfer restriction checks occur inside the token, with the compliance rules either hardcoded or delegated to an off-chain oracle.
ERC-3643 externalizes compliance into a modular compliance architecture: the Token contract references separate smart contracts (Identity Registry, Compliance Module) that manage investor identity and transfer rules independently. This modular design enables compliance rules to be updated without redeploying the token contract — a significant operational advantage for evolving regulatory requirements.
In practice, ERC-3643 has achieved greater institutional adoption for new security token deployments, with Tokeny Solutions, Société Générale Forge, and multiple other institutional platforms using ERC-3643. ERC-1400 was more widely used for early deployments (2018–2021) but has been largely superseded.
Institutional Adoption
ERC-1400 was adopted by several early institutional tokenized securities projects:
- Polymath: The Polymath security token platform used ERC-1400 as its foundational token standard; Polymath Network (now Polymesh) has since developed a purpose-built blockchain for security tokens
- tZERO: The OSTK-owned tZERO alternative trading system for security tokens implemented ERC-1400-compatible security tokens in its early deployments
- Harbor Protocol: Harbor’s security token compliance platform (acquired by BitGo) used ERC-1400 as its token standard
Technical Reference
For tokenization platforms evaluating ERC-1400 for new deployments (as opposed to maintaining existing ERC-1400-based instruments), the compliance architecture is functional but less modular than ERC-3643. New institutional projects generally prefer ERC-3643 for its upgrade path and modular compliance design; ERC-1400 remains relevant for understanding legacy deployments and the evolution of Ethereum security token standards.