What the SEC’s latest interpretation means for businesses, investors and crypto assets
In March 2026, the Securities and Exchange Commission (SEC) issued an interpretation clarifying when and how federal securities laws apply to crypto assets and related transactions. Before the SEC’s release, guidance tailored to the unique features of the crypto market was murky at best. Even with greater clarity about how federal laws apply to different types of digital tokens, businesses and investors should fully understand their differentiators. Failing to do so can complicate compliance efforts, impact investment decisions and lead to serious legal and financial ramifications.
Five digital token categories every business leader and investor should understand
One of the SEC’s most important takeaways is that not all crypto assets are treated the same way. Each has its own individual characteristics, uses and functions. This new roadmap lists five crypto asset categories to determine which are considered securities or nonsecurities, including digital commodities, digital collectibles, digital tools, stablecoins, and digital securities.
Here’s where and how federal securities laws apply to the five classifications of crypto assets, and how the SEC defines them:
Digital commodities (not securities): For a crypto asset to be a digital commodity, it must be used as part of the blockchain’s consensus mechanism, or it must convey governance rights over technical or governance matters to the crypto asset holders.
Digital collectibles (typically not securities): Digital collectibles examples include digital artwork, music, video clips, trading cards, in-game items, or tokenized representations of memes, characters and cultural moments. Owning a digital collectible typically isn't considered a security unless it’s fractionalized into tradable shares and/or marketed as a profit-generating opportunity.
Digital tools (not securities): These crypto assets perform a practical function, such as a membership, ticket, credential, title instrument or identity badge. Digital tools are not usually securities and include Ethereum Name Service (ENS) domain names, attestations (witnessing, verifying and officially confirming the authenticity of a document, signature or statement) and event tickets.
Stablecoins (likely not securities but can be): Stablecoins are designed to maintain a stable value, often tied to an asset like the U.S. dollar. If marketed and sold as an investment with the expectation of earning profits, stablecoins could fall under SEC regulation.
Digital securities (considered “Tokenized securities”): Traditional financial assets such as stocks or bonds can be represented as digital tokens on a blockchain. This process is referred to as tokenization. It’s important to note that changing the format of a security doesn’t alter what it is. If a token represents ownership of a traditional security or is marketed as an investment — buyers anticipate profits based on the efforts of others — it remains subject to federal securities laws.
The SEC’s interpretation of digital tokens may better explain how federal securities laws apply to crypto assets and related transactions, but distinguishing between securities and nonsecurities (or somewhere in between) remains highly nuanced. Additionally, business leaders and investors should recognize that the SEC is still considering public feedback in response to the interpretation release. Because of this, seeking legal guidance is imperative to ensure compliance with evolving federal securities laws.
about the author
Guillaume J. Aimé is a shareholder at Gallagher & Kennedy in Phoenix. He advises companies of all sizes across diverse industries in securities and business transactions, including public and private offerings, SEC reporting, and mergers and acquisitions. Aimé also advises companies and venture capital firms in VC funding and helps companies with their corporate governance, entity formation, and commercial contracts.