Equity Tokens

Definition ∞ Equity tokens are digital assets representing ownership shares in a company or project, similar to traditional stock. These tokens grant holders rights such as dividends, voting power, or a claim on company assets. They are typically issued on a blockchain and fall under securities regulations due to their financial characteristics. The issuance of equity tokens aims to democratize investment and improve liquidity for private assets.
Context ∞ The regulatory classification of equity tokens remains a prominent discussion point in crypto news, particularly regarding security laws. Companies considering tokenizing equity seek clear guidelines for issuance and trading. The potential for fractional ownership and global accessibility through blockchain technology presents both opportunities and regulatory hurdles for this asset class.