US (SEC)

The Securities and Exchange Commission (SEC) is the primary financial regulator overseeing securities markets and investor protection in the United States. Any Security Token Offering (STO) issued or made available to U.S. investors must comply with SEC regulations, ensuring transparency, legal compliance, and financial accountability.

The SEC classifies security tokens as securities, meaning they must adhere to the same regulations as stocks, bonds, and investment contracts. The determination of whether a token qualifies as a security is typically based on the Howey Test, which defines an investment contract as:

• An investment of money

• In a common enterprise

• With an expectation of profit

• Derived primarily from the efforts of others

If a tokenized asset meets these criteria, it falls under U.S. federal securities laws and must either register with the SEC or qualify for an exemption under specific regulatory frameworks.

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