<figure class="wp-block-image size-large"><img width="325px" height="183px" srcSet="https://d2ly46a6b1u3g6.cloudfront.net/wp-content/uploads/2026/04/21200040/12397-375x212.webp 375w, https://d2ly46a6b1u3g6.cloudfront.net/wp-content/uploads/2026/04/21200040/12397-662x374.webp 662w, https://d2ly46a6b1u3g6.cloudfront.net/wp-content/uploads/2026/04/21200040/12397.webp 686w" sizes="(max-width: 425px) 150px, 450px" src="https://ll-blog-dev.s3.ap-southeast-2.amazonaws.com/wp-content/uploads/2026/04/21200040/12397-662x374.webp" alt="" class="wp-image-12431"/></figure>


Digital Asset&#x27;s Canton Network just rolled out permissioned blockchain controls. Financial institutions can now block suspicious entities from accessing DeFi systems. The target? North Korean-linked hackers and other bad actors.
But it&#x27;s reigniting an old fight. Do these guardrails betray crypto&#x27;s decentralized principles?
The network&#x27;s &quot;guardrails&quot; feature lets participants define who can access specific subnets or tokenized assets. That&#x27;s a sharp departure from fully permissionless chains. On Ethereum or Solana, anyone can interact with smart contracts. <a href="https://decrypt.co/366086/how-canton-network-lets-institutions-guard-against-defi-security-risks" target="_blank" rel="noopener">Canton says no</a>.
Why Institutions Want This
&quot;Traditional institutions, bound by fiduciary duty, must be able to keep sanctioned or suspicious actors from interacting with their systems,&quot; Yuval Rooz, CEO of Digital Asset, said in company announcements.
The stakes are high. DeFi projects have lost over $6 billion to attacks since 2017. That&#x27;s rattled crypto natives and traditional finance players eyeing the space.
Rooz argues Canton&#x27;s approach makes infiltration campaigns far more difficult. &quot;If Canton projects enable these controls, North Korean-style infiltration campaigns become much harder, because addresses and entities can be screened or blocked,&quot; he said.
The network can stop threats at the infrastructure or application level. It doesn&#x27;t rely purely on reactive measures after funds disappear.
The Pushback
The design has drawn fire from crypto purists. They say Canton isn&#x27;t a &quot;true&quot; blockchain. It limits user autonomy.
But similar tensions are surfacing across mainstream DeFi. Arbitrum&#x27;s 12-member security council recently froze $71 million tied to the Kelp DAO exploit. That sparked debate. Do emergency interventions represent pragmatic risk management? Or do they undermine the permissionless ethos that defines decentralized finance?
It&#x27;s Not One-Size-Fits-All
Rooz stressed that Canton isn&#x27;t forcing institutions into a single model. Projects can choose whether to activate safeguards. Or they can emulate Ethereum and Solana&#x27;s open-access approach.
He pointed to comparable dynamics already playing out with stablecoin issuers. Circle has said it&#x27;ll only freeze USDC under court order. Tether has proactively worked with authorities to block funds tied to illicit finance. That includes state-sponsored hacking.
The Bigger Question
The broader friction? It&#x27;s between absolute decentralization and real-world regulatory obligations.
Financial institutions and consumer-facing applications increasingly view the ability to block malicious actors as essential. Not optional. High-profile exploits continue. Regulated players are moving into blockchain. Rooz believes safety parameters like Canton&#x27;s will become standard for institutional DeFi.
They&#x27;ll remain controversial among decentralization advocates.
The question is whether the industry can balance security with the open ethos that originally defined it.

CZ Wants Every Country to Build Its Own Stablecoin

Grayscale Names 5 DeFi Tokens With Real Fundamental Value

Standard Chartered Sets $100 UNI Target for 2030

SEC and CFTC Classify ETH a Commodity. Congress Eyes Law.

Canton Network's Permission Controls Stir Decentralization Debate

Canton Network's new permissioned blockchain controls let institutions block hackers but divide crypto community over decentralization vs. security trade-offs.