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ARTICLE · 03 FEBRUARY 2026

On-chain Or Off-chain, Federal Securities Laws Remain Un-chain-ged.

Lowenstein Sandler LLP
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On Jan. 28, the Securities and Exchange Commission's (SEC) Division of Corporation Finance, Division of Investment Management, and Division of Trading and Markets (collectively referred to as Staff)...

United StatesTechnology
Ethan L. Silver
Ethan L. Silver
William Brannan
William Brannan
Macauley Venora
Macauley Venora
Leo B. Choi
Leo B. Choi

What You Need To Know:

  • Tokenization does not change securities law obligations. SEC staff confirm the obvious and make clear that securities represented on a blockchain remain subject to the full scope of the federal securities laws, including Securities Act registration requirements (or valid exemptions) and Exchange Act obligations applicable to trading, clearing, and settlement activities.
  • Issuer-sponsored and third-party tokenization models carry different regulatory risks. The recent joint statement from the Securities and Exchange Commission's (SEC) Division of Corporation Finance, Division of Investment Management, and Division of Trading and Markets statement distinguishes between issuer-led tokenization (where on-chain records align with the issuer's official securityholder records) and third-party custodial or "synthetic" tokenization structures, which industry participants have long known may introduce additional compliance, disclosure, and

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