Base adds tokenized asset controls in Cobalt upgrade

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Base tokenized asset controls

Highlights

Base's Cobalt upgrade activated July 17 expands B20 token standard, enabling issuers to integrate compliance checks, corporate action scheduling, and administrative controls over assets.
The upgrade introduces Validity Transactions, letting users set onchain execution conditions for trades, enhancing trader control over execution timing and transaction privacy.
Following B20's July 8 activation for tokenized assets and Coinbase's Aug. 25 launch of tokenized U.S. stocks, Base plans to cut block times to 200 milliseconds and add protocol-level enhancements.

Cobalt expands issuer and trading functions

As reported by Cointelegraph, Base activated its Cobalt upgrade on Wednesday as its third major network upgrade and broadened the capabilities of its B20 token standard. The update lets issuers apply multiple compliance checks to the same asset, including identity verification, accredited-investor status and sanctions screening.

Cobalt also lets issuers schedule adjustments tied to corporate actions such as stock splits. That changes the number of shares shown in wallets and apps without minting or burning tokens or changing the underlying balance.

The upgrade further allows issuers to authorize administrators to move tokens from a holder's wallet without the holder's approval and attach a public note to the transfer. Base said issuers choose whether to enable that feature and who can use it, while Base itself cannot initiate those transfers.

Another addition is Validity Transactions, which let users submit transactions that become eligible for inclusion only when specified onchain conditions are met. Base said this can give traders more control over execution timing, such as making a swap eligible only if an asset reaches a set price before a block deadline, while submitted transactions can remain private until they are included in a block.

Tokenized finance becomes a bigger priority

These changes add compliance and administrative features that Base says are needed to bring traditional financial products onchain. The upgrade builds on the network's recent effort to strengthen its position in tokenized finance.

On July 8, Base activated B20 as a native token standard for stablecoins, tokenized real-world assets and other fungible tokens, allowing issuers to create assets without building custom token contracts. On July 16, Base creator Jesse Pollak said the network had made a wrong bet by focusing on creator, content and messaging apps and had fallen behind in areas including prediction markets and perpetual futures.

Pollak said financial applications, including trading and payments, would become a greater focus as Base seeks to develop into a blockchain for global finance. The standard has since gained a notable use case, with Coinbase launching tokenized U.S. stocks on Base on Aug. 25, issuing B20 tokens representing shares in Apple, Nvidia, Meta and Alphabet.

Base also said it plans in the coming months to cut block times from two seconds to 200 milliseconds, add protocol-level support for sponsored transaction fees and bundled transactions, and adopt some of the technical changes planned for Ethereum's Glamsterdam upgrade.

Our earlier coverage of ESMA’s MiCA enforcement proposals highlighted how EU regulators want stronger tools to police the crypto market, including powers to freeze assets suspected of links to financial crime and to take down scam or unauthorized websites. We also noted calls to curb misleading marketing and to act against non-EU firms soliciting EU investors without authorization—moves that would raise compliance expectations as onchain finance expands.

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