Compliance model overview

Who this is for: issuers and developers who want the whole compliance vocabulary in one place before reading each check's own page. For the architecture behind these checks, see Permissionless base, permissioned app layer. For summarized versions aimed at other audiences, see /tokenize/legal/compliance-overview (issuer lens) and /institutions/compliance-posture (institutional lens). Both link back to this page rather than repeating the definitions below.

Where compliance lives

Compliance on Lumia is enforced at the application layer (inside the contract or app an issuer deploys), not at the protocol layer. The base chain does not check identity before including a transaction in a block. This is a deliberate choice: it lets fully permissionless DeFi-style contracts and tightly gated RWA contracts run side by side on the same chain, each choosing its own rules. The mechanics of that split are covered in full at Permissionless base, permissioned app layer.

The four checks

These four terms are a general RWA-industry vocabulary (used elsewhere in the space, not a Lumia-specific trademark) applied here to describe what an issuer's application layer can check for.

Check	What it verifies	Typically applies to
KYC: Know Your Customer	Identity of an individual	Retail/individual token holders
KYB: Know Your Business	Identity and standing of a corporate entity	Institutional investors, the issuer entity itself
KYT: Know Your Transaction	Transaction-level risk (sanctions, suspicious-pattern screening)	Individual transfers, checked at the app layer
KYV: Know Your Validator	Standing of infrastructure counterparties	Validators, node operators, ecosystem infrastructure

Each has its own page with a fuller definition and where it applies.

The table above maps to a single routing question: what is actually being checked.

This does not show where in an issuer's contract each check is called, or the off-chain verification process behind it; see Permissionless base, permissioned app layer for that.

Scope

This is a technical and architectural model: where a check runs and what it verifies. Lumia makes no jurisdictional, licensing, or regulatory claim. Whether a given asset or application is compliant in a given jurisdiction is a legal question for the issuer and its counsel.