Tokenization Platform Architecture Explained: From Smart Contracts to Custody

Enterprise tokenization platforms are complex systems combining blockchain technology, traditional finance infrastructure, and regulatory compliance. Understanding this architecture is essential for technical teams evaluating platforms and enterprises building solutions.

This deep technical dive examines how modern tokenization platforms are built, from blockchain selection to custody architecture, smart contracts, APIs, and scalability considerations.

Enterprise Platform Guide: For platform selection guidance, see Best Tokenization Platforms 2025: Enterprise Guide.

Architecture Overview#

High-Level Architecture#

┌─────────────────────────────────────────────────────────┐
│                    PRESENTATION LAYER                    │
│  (Web Apps, Mobile Apps, Admin Dashboards)             │
└─────────────────┬───────────────────────────────────────┘
                  │
┌─────────────────▼───────────────────────────────────────┐
│                    API GATEWAY LAYER                     │
│  (REST APIs, GraphQL, WebSocket, Authentication)       │
└─────────────────┬───────────────────────────────────────┘
                  │
┌─────────────────▼───────────────────────────────────────┐
│                 APPLICATION LAYER                        │
│  (Business Logic, Compliance, KYC/AML, Workflows)      │
└───┬─────────────┬─────────────┬─────────────┬──────────┘
    │             │             │             │
    ▼             ▼             ▼             ▼
┌────────┐  ┌──────────┐  ┌──────────┐  ┌──────────┐
│Custody │  │Blockchain│  │Database  │  │External  │
│Layer   │  │Layer     │  │Layer     │  │Services  │
└────────┘  └──────────┘  └──────────┘  └──────────┘

Component Responsibilities#

Layer	Responsibility	Technology Examples
Presentation	User interfaces	React, Next.js, React Native
API Gateway	Request routing, auth	Kong, AWS API Gateway, Nginx
Application	Business logic	Node.js, Python, Go
Blockchain	Token operations	Ethereum, Polygon, BSC
Custody	Asset security	HSM, Multi-sig, Cold storage
Database	Off-chain data	PostgreSQL, MongoDB
External	Third-party services	KYC, Payment, Email

Blockchain Layer#

Blockchain Selection Criteria#

Platforms must choose blockchain(s) based on requirements:

Criterion	Ethereum	Polygon	BSC	Avalanche	Solana
Decentralization	★★★★★	★★★☆☆	★★☆☆☆	★★★★☆	★★★☆☆
Security	★★★★★	★★★★☆	★★★☆☆	★★★★☆	★★★★☆
Transaction Cost	Low	High	Medium	Medium	High
Speed (TPS)	15-30	7,000+	160	4,500+	65,000+
Smart Contract	Solidity	Solidity	Solidity	Solidity	Rust
Maturity	10 years	4 years	5 years	4 years	3 years
Enterprise Adoption	★★★★★	★★★★☆	★★★☆☆	★★★☆☆	★★☆☆☆

Multi-Chain Architecture#

Modern platforms often deploy across multiple chains:

Benefits:

Risk diversification
Cost optimization (different chains for different use cases)
Broader investor access
Regulatory flexibility (some jurisdictions prefer certain chains)

Challenges:

Increased complexity
Bridge security risks
Cross-chain liquidity fragmentation
Higher maintenance burden

Implementation Pattern:

interface BlockchainAdapter {
  deployToken(params: TokenParams): Promise<Address>;
  transfer(from: Address, to: Address, amount: BigNumber): Promise<TxHash>;
  balanceOf(address: Address): Promise<BigNumber>;
  // ... other operations
}

class EthereumAdapter implements BlockchainAdapter { }
class PolygonAdapter implements BlockchainAdapter { }
class BSCAdapter implements BlockchainAdapter { }

// Factory pattern for chain selection
class BlockchainFactory {
  static getAdapter(chainId: number): BlockchainAdapter {
    switch(chainId) {
      case 1: return new EthereumAdapter();
      case 137: return new PolygonAdapter();
      case 56: return new BSCAdapter();
    }
  }
}

Smart Contract Architecture#

Core Smart Contract Components#

1. Token Contract

// ERC-3643 compliant security token
contract SecurityToken is ERC20, Ownable {
    IIdentityRegistry public identityRegistry;
    ICompliance public compliance;
    
    modifier onlyVerified(address _address) {
        require(identityRegistry.isVerified(_address), "Not verified");
        _;
    }
    
    function transfer(address to, uint256 amount) 
        public 
        onlyVerified(msg.sender)
        onlyVerified(to)
        returns (bool) 
    {
        require(compliance.canTransfer(msg.sender, to, amount), "Transfer not compliant");
        return super.transfer(to, amount);
    }
}

2. Identity Registry Contract

contract IdentityRegistry {
    mapping(address => Identity) public identities;
    
    struct Identity {
        bool isVerified;
        uint16 country;
        uint256 investorType; // 1=retail, 2=accredited, 3=institutional
        uint256 verifiedAt;
    }
    
    function registerIdentity(
        address wallet,
        uint16 country,
        uint256 investorType
    ) external onlyAgent {
        identities[wallet] = Identity({
            isVerified: true,
            country: country,
            investorType: investorType,
            verifiedAt: block.timestamp
        });
    }
}

3. Compliance Contract

contract ComplianceRules {
    uint256 public maxHolders = 2000;
    mapping(uint16 => bool) public restrictedCountries;
    mapping(address => uint256) public lockupExpiry;
    
    function canTransfer(
        address from,
        address to,
        uint256 amount
    ) external view returns (bool) {
        // Check holder limit
        if (holderCount >= maxHolders && balanceOf[to] == 0) {
            return false;
        }
        
        // Check country restrictions
        if (restrictedCountries[identityRegistry.getCountry(to)]) {
            return false;
        }
        
        // Check lockup period
        if (lockupExpiry[from] > block.timestamp) {
            return false;
        }
        
        return true;
    }
}

Smart Contract Deployment Pipeline#

┌──────────────┐
│ Development  │ → Solidity/Vyper code
└──────┬───────┘
       │
┌──────▼───────┐
│  Compilation │ → Hardhat/Truffle
└──────┬───────┘
       │
┌──────▼───────┐
│   Testing    │ → Unit tests, Integration tests
└──────┬───────┘
       │
┌──────▼───────┐
│    Audit     │ → CertiK, Trail of Bits, OpenZeppelin
└──────┬───────┘
       │
┌──────▼───────┐
│   Testnet    │ → Goerli, Mumbai testnet deployment
└──────┬───────┘
       │
┌──────▼───────┐
│   Mainnet    │ → Production deployment
└──────────────┘

For security requirements, see Custody Models Guide.

Token Standards#

Common Standards#

Standard	Purpose	Compliance	Use Case
ERC-20	Fungible tokens	None (basic)	Utility tokens
ERC-1400	Security tokens	Partition-based	Reg D offerings
ERC-3643	T-REX standard	Full on-chain	European securities
ERC-1155	Multi-token	Flexible	Mixed offerings
ERC-4626	Tokenized vaults	DeFi integration	Yield-bearing

ERC-3643 Architecture (Most Common for RWA)#

┌──────────────────────────────────────────┐
│          Security Token (ERC-20)          │
└───────┬──────────────────────────────────┘
        │
        ├──→ IdentityRegistry
        │     ├─ Identity Storage
        │     ├─ Claim Topics
        │     └─ Trusted Issuers
        │
        ├──→ ComplianceModule
        │     ├─ Transfer Rules
        │     ├─ Holder Limits
        │     └─ Country Restrictions
        │
        └──→ TrustedIssuersRegistry
              ├─ KYC Providers
              └─ Verification Authority

Custody Layer#

Custody Architecture Patterns#

Pattern 1: Centralized Hot Wallet (Simple)

Platform Master Wallet (Hot)
    ↓
Investor deposits → Platform wallet
Platform distributes → Investor wallets

Pattern 2: Multi-Sig Custody (Standard)

2-of-3 Multi-Sig
    ↓
Platform Key 1 (Hot)
Platform Key 2 (Cold)
Custodian Key (Cold)

Pattern 3: Threshold Signatures (Advanced)

3-of-5 TSS Scheme
    ↓
Platform: 2 key shares
Custodian: 2 key shares
Backup: 1 key share

Key Management System#

interface KeyManagementSystem {
  // Key generation
  generateKeyPair(): Promise<KeyPair>;
  
  // Signing
  signTransaction(tx: Transaction, keyId: string): Promise<Signature>;
  
  // Key storage
  storeKey(key: PrivateKey, encryption: EncryptionParams): Promise<KeyId>;
  
  // Key rotation
  rotateKey(oldKeyId: string): Promise<KeyId>;
  
  // Backup
  exportEncryptedBackup(): Promise<EncryptedBackup>;
}

// HSM integration
class HSMKeyManager implements KeyManagementSystem {
  private hsm: HSMClient;
  
  async signTransaction(tx: Transaction, keyId: string): Promise<Signature> {
    // Sign inside HSM, key never leaves device
    return await this.hsm.sign(tx, keyId);
  }
}

For detailed custody models, see Custody Models in Tokenization Platforms.

API & Integration Layer#

RESTful API Design#

Core Endpoints:

# Token Management
POST   /api/v1/tokens                     # Create token
GET    /api/v1/tokens/:id                 # Get token details
PATCH  /api/v1/tokens/:id                 # Update token

# Transfers
POST   /api/v1/transfers                  # Initiate transfer
GET    /api/v1/transfers/:id              # Transfer status

# Investors
POST   /api/v1/investors                  # Register investor
GET    /api/v1/investors/:id              # Investor details
POST   /api/v1/investors/:id/verify       # Complete KYC

# Compliance
GET    /api/v1/compliance/check           # Check transfer eligibility
POST   /api/v1/compliance/whitelist       # Whitelist address

# Wallet
GET    /api/v1/wallets/:address/balance   # Check balance
GET    /api/v1/wallets/:address/transactions  # Transaction history

GraphQL Schema Example#

type Token {
  id: ID!
  name: String!
  symbol: String!
  totalSupply: BigInt!
  contractAddress: String!
  blockchain: Blockchain!
  holders(first: Int, after: String): HolderConnection!
  transfers(first: Int, after: String): TransferConnection!
}

type Investor {
  id: ID!
  email: String!
  walletAddress: String!
  kycStatus: KYCStatus!
  accreditedStatus: AccreditedStatus!
  holdings: [TokenHolding!]!
  transactions: [Transaction!]!
}

type Query {
  token(id: ID!): Token
  tokens(filter: TokenFilter): [Token!]!
  investor(id: ID!): Investor
  canTransfer(from: String!, to: String!, amount: BigInt!, tokenId: ID!): Boolean!
}

type Mutation {
  createToken(input: CreateTokenInput!): Token!
  initiateTransfer(input: TransferInput!): Transfer!
  verifyInvestor(investorId: ID!, documents: [Document!]!): Investor!
}

type Subscription {
  tokenTransfer(tokenId: ID!): Transfer!
  priceUpdate(tokenId: ID!): PriceUpdate!
}

WebSocket for Real-Time Updates#

// Server-side
wss.on('connection', (ws, req) => {
  const investorId = authenticate(req);
  
  // Subscribe to investor-specific events
  eventBus.on(`investor:${investorId}:transfer`, (data) => {
    ws.send(JSON.stringify({
      type: 'TRANSFER',
      payload: data
    }));
  });
  
  eventBus.on(`investor:${investorId}:kyc`, (data) => {
    ws.send(JSON.stringify({
      type: 'KYC_STATUS',
      payload: data
    }));
  });
});

// Client-side
const ws = new WebSocket('wss://api.platform.com/realtime');

ws.onmessage = (event) => {
  const { type, payload } = JSON.parse(event.data);
  
  switch(type) {
    case 'TRANSFER':
      updateTransferStatus(payload);
      break;
    case 'KYC_STATUS':
      updateKYCStatus(payload);
      break;
  }
};

Identity & Compliance#

KYC/AML Architecture#

┌─────────────────┐
│  User Submits   │
│  KYC Documents  │
└────────┬────────┘
         │
┌────────▼────────┐
│  Document OCR   │ → Extract data (Passport, ID)
└────────┬────────┘
         │
┌────────▼────────┐
│ Identity Verify │ → Jumio, Onfido, Sumsub
└────────┬────────┘
         │
┌────────▼────────┐
│ Sanctions Check │ → OFAC, EU, UN sanctions lists
└────────┬────────┘
         │
┌────────▼────────┐
│   AML Scoring   │ → Risk assessment
└────────┬────────┘
         │
┌────────▼────────┐
│ Human Review    │ → For high-risk cases
│  (if needed)    │
└────────┬────────┘
         │
┌────────▼────────┐
│   Approved /    │
│    Rejected     │
└─────────────────┘

On-Chain Identity Mapping#

contract IdentityVerification {
    // Map wallet address to off-chain identity hash
    mapping(address => bytes32) public identityHashes;
    
    // Map identity to verification status
    mapping(bytes32 => VerificationStatus) public verifications;
    
    struct VerificationStatus {
        bool isVerified;
        uint8 tier; // 1=basic, 2=accredited, 3=institutional
        uint256 verifiedAt;
        uint256 expiresAt;
    }
    
    function linkIdentity(
        address wallet,
        bytes32 identityHash,
        uint8 tier
    ) external onlyVerifier {
        identityHashes[wallet] = identityHash;
        verifications[identityHash] = VerificationStatus({
            isVerified: true,
            tier: tier,
            verifiedAt: block.timestamp,
            expiresAt: block.timestamp + 365 days
        });
    }
}

For regulatory compliance details, see Regulatory Landscape 2025.

Off-Chain Infrastructure#

Microservices Architecture#

┌─────────────────────────────────────────────────────┐
│                  API Gateway                         │
└──┬─────┬──────┬──────┬──────┬──────┬──────┬────────┘
   │     │      │      │      │      │      │
   ▼     ▼      ▼      ▼      ▼      ▼      ▼
┌────┐┌────┐┌─────┐┌─────┐┌─────┐┌─────┐┌──────┐
│Auth││User││Token││Trans││ KYC ││Comp ││Notif │
│Svc ││Svc ││ Svc ││ Svc ││ Svc ││Svc  ││ Svc  │
└────┘└────┘└─────┘└─────┘└─────┘└─────┘└──────┘

Event-Driven Architecture#

// Event bus pattern
interface EventBus {
  publish(event: DomainEvent): Promise<void>;
  subscribe(eventType: string, handler: EventHandler): void;
}

// Domain events
interface TokenTransferEvent {
  type: 'TOKEN_TRANSFER';
  tokenId: string;
  from: string;
  to: string;
  amount: string;
  timestamp: number;
  txHash: string;
}

// Event handlers
class NotificationHandler {
  async handle(event: TokenTransferEvent) {
    // Send email notification
    await emailService.send({
      to: event.to,
      subject: 'Token Transfer Received',
      body: `You received ${event.amount} tokens`
    });
  }
}

class AuditHandler {
  async handle(event: TokenTransferEvent) {
    // Log for audit trail
    await auditLog.create({
      type: 'TRANSFER',
      details: event
    });
  }
}

// Event sourcing for compliance
class TransferEventStore {
  async append(event: TokenTransferEvent) {
    // Immutable append-only log
    await db.events.insert(event);
  }
  
  async replay(tokenId: string): Promise<TokenState> {
    const events = await db.events.find({ tokenId });
    return events.reduce(applyEvent, initialState);
  }
}

Database Architecture#

Hybrid Database Strategy#

Data Type	Storage	Rationale
Token metadata	Blockchain	Immutable, source of truth
Investor PII	PostgreSQL (encrypted)	GDPR compliance
KYC documents	S3 (encrypted)	Large file storage
Transaction history	Blockchain + PostgreSQL	Blockchain (source), DB (query performance)
API cache	Redis	Fast reads
Analytics	Data warehouse	Complex queries

PostgreSQL Schema (Simplified)#

-- Investors
CREATE TABLE investors (
  id UUID PRIMARY KEY,
  email VARCHAR(255) UNIQUE NOT NULL,
  wallet_address VARCHAR(42) UNIQUE,
  kyc_status VARCHAR(20), -- pending, approved, rejected
  accredited_status BOOLEAN,
  created_at TIMESTAMP DEFAULT NOW()
);

-- Tokens
CREATE TABLE tokens (
  id UUID PRIMARY KEY,
  name VARCHAR(255),
  symbol VARCHAR(10),
  contract_address VARCHAR(42) UNIQUE,
  blockchain VARCHAR(20), -- ethereum, polygon, bsc
  total_supply NUMERIC(78,0), -- Supports uint256
  decimals INTEGER,
  created_at TIMESTAMP DEFAULT NOW()
);

-- Holdings (snapshot)
CREATE TABLE holdings (
  investor_id UUID REFERENCES investors(id),
  token_id UUID REFERENCES tokens(id),
  balance NUMERIC(78,0),
  updated_at TIMESTAMP DEFAULT NOW(),
  PRIMARY KEY (investor_id, token_id)
);

-- Transfer history (blockchain mirror)
CREATE TABLE transfers (
  id UUID PRIMARY KEY,
  token_id UUID REFERENCES tokens(id),
  from_address VARCHAR(42),
  to_address VARCHAR(42),
  amount NUMERIC(78,0),
  tx_hash VARCHAR(66) UNIQUE,
  block_number BIGINT,
  timestamp TIMESTAMP,
  status VARCHAR(20), -- pending, confirmed, failed
  INDEX idx_transfers_from (from_address),
  INDEX idx_transfers_to (to_address),
  INDEX idx_transfers_token (token_id)
);

Scalability Considerations#

Blockchain Scalability#

Challenge: Ethereum mainnet limited to ~15 TPS

Solutions:

Layer 2 Solutions
- Polygon (sidechains)
- Optimism (optimistic rollups)
- Arbitrum (optimistic rollups)
- StarkNet (ZK rollups)

Transaction Batching

// Instead of individual transfers
for (const transfer of transfers) {
  await token.transfer(transfer.to, transfer.amount);
}

// Batch transfers in single transaction
await token.batchTransfer(
  transfers.map(t => t.to),
  transfers.map(t => t.amount)
);

State Channels
- Off-chain transactions
- On-chain settlement
- Good for frequent transfers between parties

Application Scalability#

Horizontal Scaling:

┌─────────┐  ┌─────────┐  ┌─────────┐
│ API-1   │  │ API-2   │  │ API-3   │
└────┬────┘  └────┬────┘  └────┬────┘
     │            │            │
     └────────┬───┴────────────┘
              │
     ┌────────▼─────────┐
     │  Load Balancer   │
     └──────────────────┘

Caching Strategy:

// Multi-level cache
class TokenService {
  async getToken(id: string): Promise<Token> {
    // L1: In-memory cache (milliseconds)
    let token = memoryCache.get(id);
    if (token) return token;
    
    // L2: Redis cache (single-digit milliseconds)
    token = await redis.get(`token:${id}`);
    if (token) {
      memoryCache.set(id, token);
      return token;
    }
    
    // L3: Database (tens of milliseconds)
    token = await db.tokens.findOne({ id });
    if (token) {
      await redis.set(`token:${id}`, token, { ttl: 3600 });
      memoryCache.set(id, token);
      return token;
    }
    
    // L4: Blockchain (seconds)
    token = await blockchain.getToken(id);
    // Cache at all levels
    return token;
  }
}

Security Architecture#

Defense in Depth#

Layer 1: Network Security
  ↓ Firewall, DDoS protection, VPN
Layer 2: Application Security
  ↓ Input validation, OWASP Top 10
Layer 3: Authentication & Authorization
  ↓ MFA, RBAC, JWT
Layer 4: Data Encryption
  ↓ TLS, at-rest encryption
Layer 5: Smart Contract Security
  ↓ Audits, formal verification
Layer 6: Key Management
  ↓ HSM, multi-sig
Layer 7: Monitoring & Response
  ↓ SIEM, incident response

Security Best Practices#

Smart Contract:

Multiple independent audits
Bug bounty program
Formal verification for critical contracts
Time-locks for upgrades
Circuit breakers

API Security:

// Rate limiting
const rateLimiter = rateLimit({
  windowMs: 15 * 60 * 1000, // 15 minutes
  max: 100 // limit each IP to 100 requests per windowMs
});

// Input validation
const transferSchema = z.object({
  to: z.string().regex(/^0x[a-fA-F0-9]{40}$/),
  amount: z.string().regex(/^\d+$/),
  tokenId: z.string().uuid()
});

// Authentication
const authenticate = async (req, res, next) => {
  const token = req.headers.authorization?.split(' ')[1];
  if (!token) return res.status(401).json({ error: 'Unauthorized' });
  
  try {
    const payload = await jwt.verify(token, process.env.JWT_SECRET);
    req.user = payload;
    next();
  } catch (error) {
    return res.status(401).json({ error: 'Invalid token' });
  }
};

Disaster Recovery#

Backup Strategy#

Blockchain Data:

Archive nodes (full history)
Multiple RPC endpoints
Decentralized by nature (no backup needed for smart contracts)

Off-Chain Data:

┌──────────────────────────────────────────┐
│  Primary Database (us-east-1)            │
└──────────────┬───────────────────────────┘
               │ Continuous replication
┌──────────────▼───────────────────────────┐
│  Standby Database (us-west-2)            │
└──────────────────────────────────────────┘
               │ Daily snapshots
┌──────────────▼───────────────────────────┐
│  S3 Backup (encrypted, versioned)        │
└──────────────────────────────────────────┘

Recovery Time Objectives:

RTO (Recovery Time Objective): < 1 hour
RPO (Recovery Point Objective): < 15 minutes

Related Resources#

Enterprise Guides#

Best Tokenization Platforms 2025: Enterprise Guide — Platform comparison
Custody Models Guide — Security and custody
Regulatory Landscape 2025 — Compliance
Why Platforms Fail — Technical failures

Technical Resources#

Security Guide — Security best practices
API Integration Guide — Developer documentation
Smart Contract Audit — Audit checklist

Conclusion#

Enterprise tokenization platform architecture requires careful balance of:

Blockchain for trust and immutability
Off-chain systems for performance and compliance
Security at every layer
Scalability for growth

Understanding this architecture helps evaluate platforms and build better solutions.

Ready to dive deeper into platform architecture?

Schedule Technical Consultation →

This guide provides a technical overview. Actual implementations vary by platform. Consult platform documentation for specific details.

Tokenization Platform Architecture Explained: From Smart Contracts to Custody

Tokenization Platform Architecture Explained: From Smart Contracts to Custody

Table of Contents#

Architecture Overview#

High-Level Architecture#

Component Responsibilities#

Blockchain Layer#

Blockchain Selection Criteria#

Multi-Chain Architecture#

Smart Contract Architecture#

Core Smart Contract Components#

Smart Contract Deployment Pipeline#

Token Standards#

Common Standards#

ERC-3643 Architecture (Most Common for RWA)#

Custody Layer#

Custody Architecture Patterns#

Key Management System#

API & Integration Layer#

RESTful API Design#

GraphQL Schema Example#

WebSocket for Real-Time Updates#

Identity & Compliance#

KYC/AML Architecture#

On-Chain Identity Mapping#

Off-Chain Infrastructure#

Microservices Architecture#

Event-Driven Architecture#

Database Architecture#

Hybrid Database Strategy#

PostgreSQL Schema (Simplified)#

Scalability Considerations#

Blockchain Scalability#

Application Scalability#

Security Architecture#

Defense in Depth#

Security Best Practices#

Disaster Recovery#

Backup Strategy#

Related Resources#

Enterprise Guides#

Technical Resources#

Conclusion#

Pedex Engineering Team

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