Token Classification and Compliance Support for Utility and Security Tokens

A token’s name does not determine its legal status. Our token classification review examines what holders actually receive: access to a product, voting rights, ownership, repayment or a share of revenue. We assess these features alongside the tokenomics and sales model to identify the relevant legal requirements.

Working with U.S. counsel, we assess whether the token itself is a security or whether its sale involves an investment contract under the Howey test. The review considers the funding arrangements, promises made to buyers and their reliance on the project team. We explain what the findings mean for fundraising, marketing and investor restrictions.

For projects entering the EU market, we assess whether MiCA applies or whether the token falls under another legal framework. Tokens that qualify as financial instruments fall outside MiCA and require a separate securities-law assessment. This helps identify the relevant requirements for token issuance, whitepapers, disclosures and marketing.

Token classification and marketing rules need separate checks. A token may fall outside UK securities regulation while its promotion to UK consumers remains regulated—including when the issuer is based overseas. Our review covers the token’s rights, the proposed services and the requirements for promoting it to UK buyers.

In Singapore, tokens representing shares, debt or other capital markets products may fall under the Securities and Futures Act. Related crypto services may also trigger requirements under the Payment Services Act. We assess the token and the planned business activities separately, helping founders identify the offering rules and licensing requirements relevant to their project.

We help define what token holders can access, such as platform features, digital services or product benefits. The documents explain how the token can be used and any conditions or limitations. Where features are still in development, we distinguish current functionality from future plans.

Token allocations for founders, contributors and the community need clear rules. We document vesting schedules, lockups and treasury arrangements so participants understand who receives tokens, when they become available and what restrictions apply. These terms are aligned with the project’s tokenomics and distribution plans.

Our support covers utility token sales, community distributions, airdrops and launchpad arrangements. Working with counsel in the relevant markets, we identify participation restrictions, required checks and the terms for purchasing or receiving tokens. Launchpad agreements are reviewed for fees, responsibilities and distribution conditions.

We prepare and review token whitepapers, sale terms, user terms and risk disclosures. Website content and promotional materials are checked against the token’s actual features and the project’s development stage. This helps avoid conflicting statements about product access, token rights, potential returns or future exchange listings.

For projects with voting, staking or reward mechanisms, we clarify how users participate, where rewards come from and who controls key decisions. The legal review considers whether these features introduce additional regulatory requirements. Supporting terms explain eligibility, withdrawal conditions and the circumstances in which rewards or participation rules may change.

We structure tokenised equity, debt and asset-backed investments around the rights investors receive. These may include voting rights, dividends, interest payments or repayment at maturity. For real-world asset (RWA) tokenisation, the documents clarify whether investors hold ownership, an interest in an asset-owning company or a contractual claim.

The offering route depends on where you raise funds, who can invest and how the investment will be promoted. Together with local counsel, we assess registration requirements and available exemptions, including Regulation D for qualifying U.S. private placements. Each route has its own conditions for investor participation, advertising and resale.

Our support covers subscription agreements, offering memoranda, risk disclosures and supporting corporate approvals. These documents explain the investment terms, use of funds, fees and investor rights, including what happens if the project is delayed or the issuer cannot meet its obligations.

Before tokens are issued, the onboarding process needs to reflect the selected offering route. We help establish investor eligibility checks, accredited-investor verification where required, and applicable KYC and sanctions procedures. The process also records acceptance of the investment terms and any participation restrictions.

Legal terms and technical controls should work together. We coordinate with your development team on approved-wallet lists, holding periods and transfer restrictions. This helps align how tokens are issued and transferred with the offering documents and applicable legal requirements. Technical security audits remain a separate specialist service.

Security token legal support continues after issuance. We help define responsibilities for custody, ownership records, investor communications and payments. With local advisers, we also identify applicable reporting requirements and the steps needed when token rights, service providers or trading arrangements change.