SEC Staff Issues Clarification on How Existing Securities Laws Govern Tokenized Assets
Washington, D.C., Jan. 28, 2026 – The U.S. Securities and Exchange Commission (SEC) staff released new guidance on Wednesday that outlines how current securities regulations apply to securities that have been issued or represented on blockchain platforms. The statement, jointly authored by the Division of Corporation Finance, the Division of Investment Management and the Division of Trading and Markets, is intended to help market participants navigate the evolving landscape of tokenized securities without altering the underlying legal framework.
What the guidance says
The SEC staff emphasizes that a token that stands for a security is still subject to the same registration, disclosure and reporting obligations that apply to its traditional counterpart. The document does not create new rules, nor does it constitute an official SEC rule or formal guidance; rather, it serves as an interpretive aid for firms experimenting with blockchain‑based securities offerings.
Key points highlighted in the staff statement include:
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Two primary tokenization models –
- Issuer‑sponsored: The issuing company creates a token that directly reflects its own security, with ownership tracked on‑chain. Transfer of the token corresponds to a transfer of the underlying security’s ownership.
- Third‑party‑sponsored: An unaffiliated entity tokenizes an existing security. In this case, the token may not convey the same ownership rights or contractual obligations as the original security, and holders could be exposed to additional risks, such as the tokenizer’s bankruptcy.
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Regulatory parity – Tokenized securities and related security‑based swaps must comply with existing registration and disclosure rules. The guidance confirms that these products can be offered to U.S. investors provided the statutory requirements are met.
- Potential future topics – While the current release stops short of addressing self‑custody or decentralized finance (DeFi) structures, SEC staff indicated that further clarification could be forthcoming should the Commission deem it necessary.
Industry reaction
Ashley Ebersole, chief legal officer of crypto‑trading platform Sologenic, told The Defiant that the clarification is a logical extension of existing securities law into the blockchain space. He noted that any forthcoming guidance on self‑custody or DeFi would likely still be constrained by the current legal mandates unless Congress amends the statutes.
Ebersole also stressed that the guidance does not bar tokenized or synthetic securities from being marketed to U.S. investors, as long as issuers satisfy the prevailing registration and disclosure duties.
Analysis
The SEC’s clarification arrives at a time when a growing number of financial institutions are piloting tokenized versions of equities, bonds and other securities. By reiterating that on‑chain ownership records do not create a regulatory carve‑out, the staff aims to provide certainty for issuers while signaling that compliance obligations remain unchanged.
Implications for market participants
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Compliance continuity – Firms can continue to rely on established registration pathways (e.g., Form S‑1, Form D) when launching tokenized offerings, avoiding the need to develop parallel regulatory processes.
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Risk assessment – Investors in third‑party‑sponsored tokens should conduct due diligence not only on the underlying security but also on the tokenizing entity, recognizing that token ownership may not confer identical rights.
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Strategic planning – Companies weighing issuer‑sponsored versus third‑party models must weigh trade‑offs between direct control over token mechanics and the additional legal exposures tied to third‑party tokenizers.
- Future regulatory scope – The mention of possible guidance on self‑custody and DeFi suggests that the SEC may eventually address the nuances of non‑custodial holdings, which could affect protocols that enable users to hold tokens directly in personal wallets.
Key takeaways
- Tokenized securities remain subject to the same federal securities laws as their paper equivalents.
- The SEC staff guidance is interpretive, not regulatory, and does not alter existing obligations.
- Two tokenization structures are distinguished: issuer‑sponsored (direct token of the issuer’s security) and third‑party‑sponsored (token created by an external party).
- Holder rights and risk profiles can differ markedly between the two models, especially concerning bankruptcy and other third‑party exposures.
- The clarification opens the door for further SEC commentary on emerging DeFi and self‑custody arrangements.
As the tokenization of traditional assets accelerates, regulators appear poised to maintain a steady hand, ensuring that innovation proceeds within the bounds of established securities law. Market participants should monitor future SEC statements for any shifts that may affect custody, DeFi integration, or broader regulatory treatment of blockchain‑based financial products.
Source: https://thedefiant.io/news/regulation/sec-staff-clarifies-how-securities-laws-apply-to-tokenized-assets
