POC 1 · FATF Rec 15 · Smart Contract Layer

Freeze / Burn / Deny-List Simulator

The FATF mandates that stablecoin issuers embed governance controls directly into smart contracts. This simulator traces how freeze, burn, and deny-list operations execute across four token standards.

Compliance Architecture

Where Governance Controls Live

Five chains, five different compliance architectures. TRON has L3 only. Ethereum adds L4 analytics. Solana has the richest L3 with Token-2022 hooks. Base inherits L1–L2. Arc pushes compliance to L2.

TRONTRON ArchitectureL5ApplicationL4MiddlewareL3ExecutionTRC-20 BlacklistTRC-20 (USDT)T1destroyBlackFundsUSDT BurnT1L2ConsensusDPoS ValidatorsDPoST1L1NetworkP2P NetworkT1STATEGateMonitorObligationCodePolicy
ETHEREUMEthereum ArchitectureL5ApplicationL4MiddlewareChainalysis KYTChainalysisT7L3ExecutionERC-20 Freeze/BurnERC-20 (USDC)T1Blacklist MappingUSDC ContractT1L2ConsensusPoS ValidatorsCasper FFGT1L1NetworkP2P NetworkT1STATEGateMonitorObligationCodePolicy
SOLANASolana ArchitectureL5ApplicationL4MiddlewareCircle APIsCircleT7L3ExecutionToken-2022 FreezeToken-2022T1Transfer Hook Deny-ListToken-2022T1Confidential TransfersToken-2022T1L2ConsensusPoH/PoS ConsensusTower BFTT1L1NetworkP2P NetworkT1STATEGateMonitorObligationCodePolicy
BASEBase ArchitectureL5ApplicationSmart WalletERC-4337T3L4MiddlewareAgentKit OFAC/KYTAgentKitT6L3ExecutionUSDC Freeze/BurnERC-20T1OP Stack EVMOP StackT1L2Consensus← EthereumSuperchain BridgeOP StackT5L1Network← EthereumEthereum PoSCasper FFGT1STATEGateMonitorObligationCodePolicy
ARCArc ArchitectureL5ApplicationInstitutional WalletsInstitutionalT3L4MiddlewareRegulatory View KeysArc PrivacyT6L3ExecutionEVM + Confidential TXArc EVMT1L2ConsensusMalachite BFTPermissionedT1L1NetworkP2P NetworkT1STATEGateMonitorObligationCodePolicy

Interactive Proof of Concept

Governance Operation Trace

How it works: Select a token standard and operation to see the full execution trace.

  • Code-enforced (L3) — compiled into the smart contract; cannot be bypassed
  • Policy-enforced (L4–L5) — depends on external actor; can be circumvented
Input Parameters
Operation Trace
Select parameters and click "Evaluate Operation" to see the trace.

Key Insight

Same Operation, Different Enforcement

The bottom line: The same operation — "freeze an address" — has radically different enforcement properties depending on the token standard.

  • USDC on Ethereum — code-enforced at L3, cannot be bypassed without redeploying the contract
  • Generic ERC-20 — impossible at L3 without freeze function; requires L4 middleware intervention (policy-enforced)
  • ERC-3643 (T-REX) — identity-linked freeze at L3+L4; strongest enforcement in any token standard
  • Token-2022 (Solana) — native freeze authority + Transfer Hooks provide the richest L3 control surface

Why it matters: The FATF is asking issuers to ensure the L3 path exists on every stablecoin. This simulator shows which standards already meet that bar.