The United States Securities and Exchange Commission (SEC) has released new guidance stating that tokenized assets are securities first and crypto assets second. The agency makes clear that putting a security on a blockchain does not change its legal status or the rules that apply.
In a joint statement, three SEC divisions said federal securities laws still govern stocks, bonds, and other instruments even when they are tokenized. The guidance stresses that the method of recording ownership, whether on a traditional database or a crypto network, does not affect registration and disclosure duties.
What the SEC Means by Tokenized Securities
The SEC defines a tokenized security as a regular security whose ownership record appears partly or fully on a blockchain. The guidance explains that the token is simply a new format for tracking who owns the underlying asset, not a new type of product.
Additionally, officials outlined two primary tokenization possibilities. Third-party models depend on outside companies that convert existing securities into digital tokens; issuer-sponsored models depend on the corporation minting or sponsoring the tokenized form.
Unless there is a specific exemption, the SEC reminds businesses that tokenized securities require registration according to the same regulations as traditional offerings. Depending on their operations, companies that list or trade tokenized stocks or bonds could require registration as broker-dealers or use alternative trading systems.
For third‑party tokenization, the guidance splits structures into custodial and synthetic types. Custodial tokens represent claims on real securities held in custody, while synthetic tokens track the value of a security through contracts and can face stricter oversight.
Why the Guidance Matters for Crypto and Finance
The SEC’s move comes as the market value of tokenized real‑world assets climbs into the tens of billions of dollars. Large financial institutions are testing tokenization to speed up settlement, improve transparency, and cut back‑office costs while staying inside existing securities rules.
Legal experts say the new guidance confirms a simple message from regulators that “tokenization changes nothing legally.” However, they also note that markets and technology may need fresh rulemaking in the future because today’s framework was not built for fully on‑chain trading venues.
READ MORE: Ethereum Price Forms Risky Pattern as Transactions Jump 40%
