Permissioned Token

Definition ∞ A permissioned token is a digital asset whose transfer or ownership is restricted to pre-approved participants or wallets. Unlike public blockchain tokens, these assets incorporate rules that govern who can hold or transact with them. This control mechanism is often implemented to ensure compliance with regulatory requirements or specific business policies. Such tokens are frequently employed in enterprise blockchain solutions.
Context ∞ Permissioned tokens are gaining traction in institutional finance and regulated environments where compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations is mandatory. Discussions revolve around the technical implementation of these access controls and their impact on liquidity and interoperability. Developments include the use of zero-knowledge proofs to verify participant eligibility without revealing sensitive personal data, balancing privacy with regulatory adherence.