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Securities Token

Definition

A securities token is a digital asset issued on a blockchain that represents ownership in an underlying traditional security, such as equity, debt, or real estate. These tokens are subject to securities regulations because they confer rights similar to conventional financial instruments, like voting rights, dividend payments, or a share of profits. They combine the programmability and transferability of blockchain technology with the legal framework of traditional finance. Their creation aims to increase liquidity and accessibility for illiquid assets.