Development Fund Proposal
Author: Priyanshu Sinha (CSO) | Elvis Rodrigues (CPO) | Prasanth Kalangi (CEO) | Rajat Kumar (Blockchain Lead), Zoniqx Inc
Status: Submitted
Created: 2026-02-23
Revised: 2026-08-27
Label: dapp-integration
Champion: Need Champion
Funding Request: 250,000 CC
Indicative delivery window: 12 weeks, subject to validation of DA Registry interfaces and confirmation of the final implementation scope
Abstract
Zoniqx proposes a Canton native integration of zConnect and an ERC-7518 compatibility profile using Digital Asset's existing DA Registry and Canton Token Standard infrastructure.
DA Registry capabilities for token issuance, minting, burning, holdings administration, transfers, permissions, credentials, recovery and settlement will provide the foundational asset and settlement layer. The grant funded work will focus on zConnect's institutional distribution workflows and the ERC-7518 compatibility profile.
For instruments administered through DA Registry, DA Registry provides the authoritative asset administration and holdings workflows. zConnect will be the system of engagement for issuers, investors and deal workflows.
The grant funded public good outputs, being the ERC-7518 Canton Compatibility Profile, the Canton integration adapters and reference implementation, and the associated Canton integration SDK components, Canton conformance tests and technical documentation, will be released under Apache-2.0, subject to legal and ecosystem review. Zoniqx will continue operating the hosted zConnect platform commercially.
Specification
1. Objective
Zoniqx will build a Canton native integration of zConnect and an ERC-7518 compatibility profile on top of Digital Asset's existing DA Registry and Canton Token Standard infrastructure.
The grant funded work will focus on two differentiated contributions:
- Translate the regulated asset semantics defined by ERC-7518 into Canton compatible Daml workflows, metadata and integration interfaces.
- Connect zConnect's issuer origination, institutional deal distribution, subscription, allocation and investor network workflows to DA Registry and Canton's standard settlement APIs.
This approach reduces duplication, shortens delivery time and ensures that assets introduced through Zoniqx remain interoperable with Canton wallets, custodians, registries and applications.
Scope boundary. The integration will consume DA Registry capabilities for token issuance, minting, burning, holdings administration, transfers, permissions, credentials, recovery and settlement. Cross chain work during the initial grant will cover interface specification; production bridging would require separate approval.
2. Implementation Mechanics
2.1 Relationship with DA Registry
For instruments administered through DA Registry, DA Registry provides the authoritative asset administration and holdings workflows used by this integration, including:
- Instrument creation and asset administration
- Mint, burn and transfer workflows
- Canton Token Standard compatibility
- Holdings and ownership records
- Credential based permissions
- Allowlists, blocklists and transfer controls
- Asset recovery and administrative actions
- Allocation and delivery versus payment settlement
- Connectivity with Canton wallets, custodians and applications
Zoniqx will consume these capabilities through supported Daml interfaces and APIs.
| Layer | Primary responsibility |
|---|
| DA Registry and Canton Token Standard | Asset issuance, authoritative holdings, lifecycle administration, permissions, transfers and settlement |
| ERC-7518 compatibility profile | Regulated asset semantics, partition and share class mapping, compliance policy inputs and lifecycle compatibility |
| zConnect | Issuer origination, deal room workflows, investor discovery, subscriptions, allocation controls and institutional distribution |
| Zoniqx compliance integration | Evaluation of jurisdictional, offering and investor rules using credentials and policy decisions consumed by Canton workflows |
2.2 ERC-7518 Compatibility Profile
ERC-7518 is defined for Solidity and the EVM account model. Canton uses Daml contracts, privacy aware multiparty workflows and the Canton Token Standard. The project will map ERC-7518 semantics directly to Canton native contracts and workflows.
Zoniqx will produce an ERC-7518 Canton Compatibility Profile documenting how each required regulated asset behavior is represented through Canton native contracts and workflows.
| ERC-7518 capability | Proposed Canton treatment |
|---|
| Partitions and share classes | Canton instrument configurations, instrument metadata and separate regulated holding classes |
| Transfer eligibility | Credential requirements, transfer preapproval, registry controls and Zoniqx compliance policy decisions |
| Transfer restrictions | Canton native authorization and registry workflows enforcing issuer, jurisdiction and offering restrictions |
| Lock and unlock | Holding, allocation or instrument level workflow controls selected during architecture validation |
| Freeze and unfreeze | Authorized registry administration and recovery workflows with auditable role based controls |
| Forced transfer and recovery | Existing DA Registry recovery and administrative capabilities, extended only where a documented gap exists |
| Compliance vouchers | Signed or verifiable compliance decisions mapped to Canton credentials, metadata or workflow authorizations |
| Payouts and distributions | Canton Token Standard asset and cash allocations coordinated through zConnect settlement workflows |
| Asset lifecycle events | Registry native mint, burn, redemption and administration workflows |
| Cross chain compatibility | Interface specification during the initial grant; production bridging would require separate approval |
Where DA Registry already provides the required behavior, the compatibility profile will reference and use it. Where a genuine gap exists, Zoniqx will develop the smallest reusable adapter or Daml interface necessary to represent the ERC-7518 requirement.
If the architecture review identifies functionality that would benefit the broader Canton ecosystem, Zoniqx will work with its ecosystem champion and the relevant Special Interest Group to determine whether the output should become a reusable integration pattern, open source package or future Canton Improvement Proposal.
2.3 zConnect Institutional Distribution Layer
zConnect will operate above the registry and settlement layer, focusing on the origination and controlled distribution of institutional assets to an existing buy side network.
The Canton integration will support:
- Issuer and offering onboarding
- Secure deal rooms and offering document access
- Investor discovery and invitation workflows
- Investor qualification and suitability checks
- Jurisdiction specific distribution eligibility
- Subscription and indication of interest workflows
- Allocation approval and rejection
- Offering caps and remaining allocation calculations
- Allocation instructions for Canton settlement
- Delivery versus payment transaction orchestration
- Issuer and investor activity reporting
Distribution rules will be configurable per offering. The specific policy parameters will be defined with each issuer during onboarding.
2.4 End to End Workflow
- An issuer or authorized registrar creates a Canton compatible instrument through DA Registry.
- ERC-7518 asset characteristics and regulated asset policies are attached through the agreed compatibility profile.
- The issuer creates an offering in zConnect and defines its distribution policy.
- Eligible institutional participants are invited from the zConnect network.
- Investor credentials and suitability information are evaluated while personally identifiable information remains off the shared ledger.
- zConnect applies offering, jurisdiction, investor and allocation rules.
- Approved subscriptions are converted into Canton Token Standard allocation requests.
- Wallets and counterparties authorize the corresponding asset and payment allocations.
- The transaction settles using Canton native delivery versus payment workflows.
- DA Registry updates the authoritative asset holdings while zConnect updates the deal, allocation and distribution records.
2.5 Technical Components
| Component | Description |
|---|
| A. DA Registry integration adapter | A reusable integration layer connecting zConnect with DA Registry workflows and Canton Token Standard APIs |
| B. ERC-7518 Canton Compatibility Profile | A public technical specification mapping regulated asset semantics into Canton native primitives |
| C. Compliance policy adapter | An adapter that evaluates Zoniqx offering and jurisdictional rules, provides the corresponding policy decision or credential evidence to the Canton workflow, and consumes credential and allowlist infrastructure supplied by DA Registry |
| D. zConnect Canton transaction orchestrator | A service that converts approved subscriptions and allocations into Canton compatible allocation and settlement instructions |
| E. Canton integration SDK, documentation and conformance tests | Canton specific SDK components, reference code, technical documentation and automated tests enabling other Canton ecosystem participants to understand and reproduce the integration pattern |
3. Architectural Alignment
| Canton principle | This proposal |
|---|
| Sub transaction privacy | Investor credentials and suitability information are evaluated while personally identifiable information remains off the shared ledger |
| Composable Daml contracts | Integration adapters consume DA Registry workflows and Canton Token Standard APIs through supported interfaces |
| Multiparty workflows | Issuer, distributor, investor and registry participate in origination, subscription, allocation and settlement with their respective visibility |
| Reuse existing capabilities | The DA Registry overlap and reuse assessment is a Milestone 1 deliverable; every proposed adapter must be justified against a documented gap |
The integration uses standard Daml packages and integration services while preserving the Canton core protocol and SDK.
4. Backward Compatibility
No backward compatibility impact. All components are additive and consume published DA Registry and Canton Token Standard interfaces. The compatibility profile will state its version assumptions and will be maintained against supported Token Standard versions.
5. Open Source and Proprietary Scope
| Component | Grant funded public output | Zoniqx proprietary scope |
|---|
| ERC-7518 Canton Compatibility Profile | Published under Apache-2.0 | — |
| DA Registry integration adapters and Canton reference implementation | Reusable Canton interfaces and reference code published under Apache-2.0, subject to applicable DA interface and licensing requirements | Production configuration and managed deployment |
| Canton integration SDK, conformance tests and technical documentation | Canton specific SDK components, tests, deployment guidance and technical documentation published under Apache-2.0 | — |
| Hosted zConnect platform | — | Commercial application, deal room interfaces and operational services |
| Issuer and investor network | — | Relationships, data and commercial engagement |
| Implementation and onboarding services | — | Commercial support beyond the grant deliverables |
Milestones and Deliverables
Each funded milestone has objective technical outputs within Zoniqx's delivery control, with objective acceptance criteria. Post launch commercial adoption is measured separately and is set out after Milestone 4. The week ranges below are indicative planning estimates and will be finalized following technical validation.
Milestone 1: Architecture and Compatibility Validation
Timeline: Weeks 1 to 2
Deliverables
- Complete DA Registry overlap and reuse assessment
- ERC-7518 to Canton capability mapping
- zConnect and DA Registry integration architecture
- Canton participant, application and service topology
- Compliance and credential data flow specification
- Distribution policy model
- Public versus proprietary component definition
- Security and privacy threat model outline
- Implementation and conformance test plan
- Review with the ecosystem champion and technical partners
Acceptance criteria
- Every ERC-7518 capability is classified as supported directly by DA Registry, supported through Canton Token Standard interfaces, requiring a Zoniqx adapter, or deferred from the initial grant scope
- The architecture reuses existing registry, credential and settlement infrastructure
- The champion or designated Canton technical reviewer confirms architectural alignment
- All public deliverables and proposed licenses are documented
- Daml scaffolding and the integration test environment are operational
Adoption readiness. Zoniqx will provide the committee a confidential, categorized summary of its active issuer pipeline relevant to Canton. This includes issuers across private credit, government invoice factoring, sovereign backed bonds, regulated fund vehicles and commodity tokenization. Issuer identities will be shared with the committee under confidentiality where required. This evidence supports the adoption case; milestone acceptance remains based on the technical criteria above.
Milestone 2: ERC-7518 Compatibility and End to End Proof of Concept
Timeline: Weeks 3 to 5
Deliverables
- First version of the ERC-7518 Canton Compatibility Profile
- DA Registry integration adapter
- Compliance policy adapter
- Representative regulated instrument configured on Canton testnet
- zConnect deal and subscription workflow
- Canton Token Standard allocation request
- End to end testnet delivery versus payment demonstration
- Automated tests for eligible and ineligible transfers
Acceptance criteria
- Creation or configuration of a regulated test instrument through existing Canton infrastructure
- ERC-7518 partition or share class representation
- Investor eligibility evaluation
- Rejection of an ineligible subscription or transfer
- Approval of an eligible subscription
- Creation of the corresponding allocation request
- Successful testnet settlement
- Reconciliation between DA Registry holdings and zConnect deal records
A synthetic but commercially representative asset structure may be used to keep completion independent of external timelines.
Milestone 3: Testnet Release and External Validation
Timeline: Weeks 6 to 9
Deliverables
- Production quality testnet integration
- Issuer and investor workflow interfaces
- Configurable distribution policy controls
- Canton integration SDK and API documentation
- Deployment guide
- Compatibility and conformance test suite
- Operational monitoring and reconciliation
- External technical validation with the champion or another Canton participant
- Pilot onboarding package prepared for an initial design partner issuer drawn from the Zoniqx pipeline, with buy side participants from the zConnect network invited for testnet feedback
Acceptance criteria
- An external Canton ecosystem reviewer completes the documented workflow
- At least one representative offering is processed end to end
- Distribution rules enforce eligibility and allocation constraints
- The Canton integration SDK and documentation enable a third party to reproduce the integration
- Critical security or architecture findings are resolved or documented with an approved remediation plan
Adoption evidence. Zoniqx has received a non binding expression of interest from a prospective institutional design partner relevant to the proposed Canton integration. Subject to the counterparty's authorization and confidentiality requirements, supporting evidence can be shared privately with the Tech & Ops Committee. This expression of interest provides evidence of market demand and does not constitute a deployment, transaction volume or commercial commitment.
Milestone 4: Production Readiness and Mainnet Deployment
Timeline: Weeks 10 to 12
Deliverables
- Production Canton packages and integration services
- Final ERC-7518 Canton Compatibility Profile
- Security review and remediation report
- Mainnet deployment configuration
- Operational runbook and incident procedures
- Upgrade and maintenance policy
- Opensource release of the grant funded public components
- Controlled mainnet transaction or equivalent production readiness validation approved by the champion
Acceptance criteria
- Public packages compile, deploy and pass the conformance suite
- The integration works with applicable Canton Token Standard and DA Registry interfaces
- All critical security findings are resolved
- A production operator can deploy and maintain the public components using the documentation
- The production workflow demonstrates instrument configuration, eligibility validation, allocation and settlement
- Zoniqx begins its 12 month maintenance period
Post Launch Adoption Commitments
Technical milestone completion and post launch commercial adoption are measured separately. Zoniqx commits to the following adoption effort in the 12 months following production release, reported transparently to the foundation:
- Onboard 2 to 3 issuers onto the Canton integration in the first 6 months, drawn from Zoniqx's existing pipeline of regulated issuers across private credit, government receivables, sovereign backed instruments and fund tokenization
- Target 5 or more issuers entering implementation within 12 months
- Activate institutional buy side participants from the zConnect network, which includes family offices, broker dealer networks, hedge funds and DeFi capital allocators, for Canton offerings
- At least one live regulated instrument with completed allocations and settled transactions on Canton within 12 months, subject to the issuer's legal and compliance approvals
Zoniqx currently supports issuance across 29 jurisdictions and will prioritize asset classes with the strongest institutional demand for Canton's privacy enabled settlement.
Acceptance Criteria
The Tech & Ops Committee may evaluate completion based on the per milestone acceptance criteria set out above, together with:
- Demonstrated reuse. Every ERC-7518 capability is classified against DA Registry and Canton Token Standard capabilities, and the architecture reuses existing registry, credential and settlement infrastructure
- External validation. An external Canton ecosystem reviewer completes the documented workflow at Milestone 3
- Reproducibility. The Canton integration SDK and documentation enable a third party to reproduce the integration
- Production readiness. Public packages compile, deploy and pass the conformance suite at Milestone 4, with all critical security findings resolved
- Maintenance. Zoniqx begins its 12 month maintenance period on the grant funded packages
Funding
Total Funding Request: 250,000 CC
Payment Breakdown by Milestone
| Milestone | Amount | Main workstreams | Payment trigger |
|---|
| M1 — Architecture and Compatibility Validation | 50,000 CC | DA Registry capability assessment, ERC-7518 mapping, architecture, privacy and security design and implementation planning | Committee acceptance |
| M2 — ERC-7518 Compatibility and End to End Proof of Concept | 62,500 CC | Compatibility profile, Registry and compliance adapters, representative test instrument, integration workflow and automated testing | Committee acceptance |
| M3 — Testnet Release and External Validation | 75,000 CC | Testnet integration, issuer and investor workflows, Canton integration SDK and API documentation, monitoring, conformance testing and external validation | Committee acceptance |
| M4 — Production Readiness and Mainnet Deployment | 62,500 CC | Production hardening, security remediation, deployment configuration, operational runbooks, open source release and maintenance handover | Final release and committee acceptance |
The allocations reflect the current implementation assumptions and will be confirmed after validation of the applicable DA Registry interfaces and final technical scope.
The first payment becomes due upon committee acceptance of Milestone 1.
Volatility Stipulation
The current planning assumption is 12 weeks and remains subject to technical validation. Should Committee requested scope changes or validated technical requirements extend the project beyond six months, remaining milestones will be renegotiated per Development Fund volatility policy.
Co Marketing
Upon production release, Zoniqx and the Canton Foundation will collaborate on:
- Announcement coordination anchored on the first live offering distributed through the integration
- A technical blog and implementation guide covering the integration pattern and the ERC-7518 Canton Compatibility Profile, aimed at teams bringing regulated assets to Canton from EVM ecosystems
- A developer workshop or reference walkthrough for Canton builders integrating against the published Canton integration SDK
- Maintenance of the grant funded packages and compatibility profile for at least 12 months following production release
Any issuer specific case study requires that issuer's prior written authorisation.
Motivation
For instruments administered through DA Registry, DA Registry provides the authoritative asset administration and holdings workflows, including permissions, transfers and delivery versus payment (DvP) settlement. The Canton Token Standard provides the standard interfaces through which those instruments are held and settled.
This proposal adds the zConnect integration layer for the origination and controlled distribution of institutional assets to an existing buy side network. Issuers may otherwise need to integrate investor qualification, jurisdiction specific distribution eligibility, subscription handling and allocation control independently.
The proposal also provides a documented representation of regulated asset semantics for issuers arriving from EVM ecosystems. ERC-7518 is defined for Solidity and the EVM account model, and the compatibility profile will provide a common reference for teams reasoning about the same instrument across both environments.
Representative ERC-7518 Use Cases on Canton
| Use case | Potential users | Value of ERC-7518 compatibility |
|---|
| Private credit and receivables instruments | Private credit issuers, receivables platforms and institutional investors | Maps share classes, investor eligibility and transfer restrictions into Canton native workflows while using DA Registry for authoritative holdings and settlement |
| Regulated tokenized funds | Fund managers, administrators and tokenization platforms | Provides a common representation for fund classes, transfer controls, locks, recovery and lifecycle events across EVM and Canton environments |
| EVM originated regulated instruments expanding to Canton | Issuers and platforms already using ERC-7518 concepts | Gives technical teams a documented compatibility path for representing regulated asset semantics through Canton contracts and workflows |
These are representative use cases rather than confirmed issuer commitments.
This proposal addresses both. It ensures that assets introduced through Zoniqx remain interoperable with Canton wallets, custodians, registries and applications, and it publishes the Canton integration pattern, Canton integration SDK, conformance tests and compatibility profile so other Canton ecosystem participants can understand and reproduce it.
Rationale
Building on DA Registry. DA Registry already provides instrument creation, mint, burn and transfer workflows, Canton Token Standard compatibility, holdings and ownership records, credential based permissions, allowlists and blocklists, asset recovery, and allocation and delivery versus payment settlement. Zoniqx will consume these capabilities through supported Daml interfaces and APIs. This approach reduces duplication and shortens delivery time.
Validating the boundary before implementation. The DA Registry overlap and reuse assessment is the first deliverable and validates the integration boundary before implementation. Every ERC-7518 capability is classified as supported directly by DA Registry, supported through Canton Token Standard interfaces, requiring a Zoniqx adapter, or deferred from the initial grant scope. Where DA Registry already provides the required behavior, the compatibility profile references and uses it. Where a genuine gap exists, Zoniqx develops the smallest reusable adapter or Daml interface necessary.
Canton native compatibility specification. ERC-7518 is defined for Solidity and the EVM account model, while Canton uses Daml contracts and privacy aware multiparty workflows. The compatibility profile documents how each regulated asset behavior is represented through Canton native contracts and workflows so other ecosystem participants can use it.
Configurable policy. Distribution rules are configurable per offering, with the specific policy parameters defined with each issuer during onboarding, because regulated distribution requirements vary by issuer, jurisdiction and offering structure.
Separating public good from commercial product. The grant funds the ERC-7518 Canton Compatibility Profile, the Canton integration adapters and reference implementation, and the associated Canton integration SDK components, Canton conformance tests and technical documentation, released under Apache-2.0 subject to legal and ecosystem review. Zoniqx continues operating the hosted zConnect platform commercially. If the architecture review identifies functionality that would benefit the broader ecosystem, Zoniqx will work with its champion and the relevant Special Interest Group to determine whether the output should become a reusable integration pattern, open source package or future Canton Improvement Proposal.
Reference Links
