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SEC outlines its views on tokenised securities
29 January 2026 US
Image: Tada_Images/stock.adobe.com
The US Securities and Exchange Commission (SEC) has outlined its views on the classifications of tokenised securities and its intention to provide greater clarity with regard to federal securities laws surrounding crypto assets.
According to the regulator, the only main differentiator between a tokenised security and a traditional one is the master securityholder file on one or more crypto networks, as opposed to conventional offchain database records, and they are generally classified as either issuer or third-party.
Furthermore, securities can be issued in multiple formats or converted from one format to another, which the SEC says does not affect the application of federal securities laws.
Conversely, an issuer could tokenise a security without a crypto network being a part of the master securityholder file, in which case the crypto asset is not afforded the same rights, obligations, or benefits as the security, according to the SEC.
Third parties with no affiliation to an issuer of a security could also tokenise them, with models that may differ substantially from the issuers, resulting in the rights, obligations, and benefits associated with the crypto asset potentially varying from those of the underlying security.
A custodial tokenised security may be accomplished by integrating DLT into the records of entitlement holders, where, under this model, the crypto asset represents the holder’s indirect interest in the underlying security.
In the case of a tokenised linked security, one issued by the third party itself that provides synthetic exposure to a referenced security, it is not an obligation of the issuer, nor does it carry the same rights or benefits as the referenced security.
According to the regulator, the only main differentiator between a tokenised security and a traditional one is the master securityholder file on one or more crypto networks, as opposed to conventional offchain database records, and they are generally classified as either issuer or third-party.
Furthermore, securities can be issued in multiple formats or converted from one format to another, which the SEC says does not affect the application of federal securities laws.
Conversely, an issuer could tokenise a security without a crypto network being a part of the master securityholder file, in which case the crypto asset is not afforded the same rights, obligations, or benefits as the security, according to the SEC.
Third parties with no affiliation to an issuer of a security could also tokenise them, with models that may differ substantially from the issuers, resulting in the rights, obligations, and benefits associated with the crypto asset potentially varying from those of the underlying security.
A custodial tokenised security may be accomplished by integrating DLT into the records of entitlement holders, where, under this model, the crypto asset represents the holder’s indirect interest in the underlying security.
In the case of a tokenised linked security, one issued by the third party itself that provides synthetic exposure to a referenced security, it is not an obligation of the issuer, nor does it carry the same rights or benefits as the referenced security.
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