The Token Taxonomy Initiative has released the Token Taxonomy Framework (TTF) V 1.0. The Framework is designed to standardized tokenization including the issuance of securities.
According to the initiative, users of the TTF can create a new type of token from a set of “reusable, cross-industry components, including existing token definitions, creating a specification that includes all of the business ingredients for any implementation.
The Initiative is described as a “platform neutral” project and involves numerous recognized names from the blockchain industry.
Token Taxonomy Initiative members include Accenture, Adhara, Banco Santander, Blockchain Research Institute, Clearmatics, ConsenSys, Digital Asset, Envision Blockchain, EY, Hedera Hashgraph, IBM, Intel, ioBuilders, Itau, J.P. Morgan, Komgo, Microsoft, R3, and Web3 Labs, among others.
The framework seeks to enable businesses to develop a clear definition and scope of the token concept, including use cases, taxonomy and terminology, and a specification neutral to the underlying technology – whether or not the token is hosted on a blockchain platform.
“Whether it’s a ticket, supply chain documents, stocks, property titles, loyalty points, or other as-yet unthought-of blockchain-based products and services, token use should be able to flow across platforms. If we want to take full advantage of what collaborative platforms have to offer, cross-platform transactions have to be able to communicate with one another. Standards are where that starts, and this Framework makes unlocking the untapped potential of tokens on the blockchain possible,” said Marley Gray, chair of the Token Taxonomy Initiative, EEA Board member and principal architect, Microsoft.
There has been a lot of development in the blockchain sector in a short period of time but without standardization, the industry risks remaining highly fragmented and lightly utilized. While expectations are for the technology to evolve over time, a baseline standard can help establish better-defined protocols and can boost utilization more rapidly.
Gray explained that the framework enables a business person to create a token visually using a design tool without writing any code whatsoever and allows them to tell developers: “I want one of these.”
One Framework for Multiple Platforms
The Initiative says the TTF framework provides:
- A common set of concepts and terms that can be used by business, technical, and regulatory participants so they can speak the same language
- A composition framework for defining and building tokens
- A Token Classification Hierarchy (TCH) that is simple to understand
- Tooling meta-data using the TTF syntax to be able to generate visual representations of classifications, and modeling tools to view and create token definitions mapped to the taxonomy – enabling linking with implementations for specific platforms
- A definition of tokens and their use cases across industries
- Example and real-world token specifications that are reusable, with parts portable across definitions from Adhara, ConsenSys,
- Digital Asset, Enterprise Ethereum Alliance (EEA), IBM, ioBuilders, Microsoft, and R3. Specific examples include:Adhara’s and ioBuilders’ EMoneyToken standard is being used in production payments and settlement systems
- Digital Asset will apply TTF standards to assets tokenized with DAML smart contracts
- Microsoft announced TTF support in Azure Blockchain Tokens, which simplifies the ability to define, create and manage compliant tokens based on TTF standards.
- Links to coded examples in a variety of languages to accelerate the movement from token definition to token implementation, regardless of platform
EEA Executive Director Ron Resnick said that various implementations and taxonomies exist for tokens but the industry is currently lacking a venue for all participants to work together to describe how tokens can eventually interoperate across the multiple and disparate systems.
“The TTF is now that venue. Plus, the EEA will be launching an EEA Token Working Group that will leverage the TTF framework to extend our global standards work.”
David Treat, TTI member, a managing director and global blockchain lead at Accenture, and vice-chairman of the Board of the EEA called the Taxonomy Framework an important step to drive real business transformation.
“The concept of digital tokens has been given to us by the blockchain world, and it appears that in the coming years many different asset classes will be tokenized. As such, the Token Taxonomy Initiative’s framework will be key to ensuring that this next wave of financial innovation will start with cross-platform standards in mind,” added John Whelan, TTI member, chairman of the Board of the EEA, and head of Digital Investment Banking at Banco Santander.