DIGITAL SECURITIES
DIGITAL SECURITIES
Security tokens and digital securities: what issuers need to know
Security tokens and digital securities: what issuers need to know
Issued digitally, a bond, a share or a fund unit is still a security: enforceable investor rights, the same EU disclosure and distribution rules that apply to its paper equivalent, and nothing like a utility token. What changes is how it is recorded, and that is set by national law. This guide covers the token types, the instruments and the rules.
Issued digitally, a bond, a share or a fund unit is still a security: enforceable investor rights, the same EU disclosure and distribution rules that apply to its paper equivalent, and nothing like a utility token. What changes is how it is recorded, and that is set by national law. This guide covers the token types, the instruments and the rules.
ASK FIRST
Two decisions, not one
Two decisions, not one
Almost every confusion in this field comes from collapsing these two into a single question. They are decided by different people, at different times, under different law.
What are you issuing?
A bond, a share, a fund unit, or a non-transferable participation. This decides your disclosure obligations, who may distribute it, and what investors actually own.
Issue your own instrumentHow is it recorded?
A certificate, a book entry at a central securities depository, or an electronic record in a securities register, which may be kept on a distributed ledger. This decides operations and transferability, not the rules.
See the issuance platformTHE TEST
The three token types issuers confuse
The three token types issuers confuse
Before any of the above matters, you have to know whether what you are issuing is a security at all. The test is simple: if investors expect a return generated by your effort, it is almost certainly a security, and securities law applies in full.
| Instrument | What the investor owns | Disclosure | Typical use |
|---|---|---|---|
| InstrumentBondFor example: A €20m bond financing a residential development, paying a fixed coupon. | What the investor ownsA claim to interest and repayment, ranking ahead of equity | DisclosureProspectus above the threshold, otherwise a national document | Typical useProject and property finance |
| InstrumentEquityFor example: A growth company issuing shares to a syndicate of investors rather than a single VC. | What the investor ownsOwnership, upside, and usually voting rights | DisclosureProspectus above the threshold, plus company law formalities | Typical useGrowth and startup financing |
| InstrumentFund unitFor example: Units in a private credit fund that pools capital from many investors and lends it on. | What the investor ownsA share of a pooled portfolio, managed to a stated policy | DisclosureFund documentation, plus AIFMD obligations on the manager | Typical useAsset and fund managers |
| InstrumentNon-transferable participationFor example: A subordinated loan taken from a company's own customer base, which investors cannot resell. | What the investor ownsA contractual return, with no tradable security behind it | DisclosureNational rules only, no EU-level document | Typical useSelf-issuance to an existing base |
The three numbers that decide most of it
Before any analysis of instruments or technology, these thresholds tell you roughly what your raise will cost and how long it will take.
Growth in digital bond issuance
Digital bonds went from €848m issued in 2023 to €3bn in 2024, and Europe was the largest region of the three. A small market, but one that more than trebled in a single year while the wider bond market stood still.
Digital bonds paid for in central bank money
What moved in those trials were digital securities. Across 58 use cases, 64 institutions in nine countries delivered bonds held on a ledger against real euros from the central bank, including Slovenia's first digital sovereign. The permanent service, Pontes, goes live this year.
The ceiling being raised
The EU's DLT venues are the only place a security can be traded and settled on its own register, and each is capped at €6bn today, with no bond above €1bn. In December 2025 the Commission proposed a €100bn ceiling and no per instrument limits at all.
The three numbers that decide most of it
Before any analysis of instruments or technology, these thresholds tell you roughly what your raise will cost and how long it will take.
Growth in digital bond issuance
Digital bonds went from €848m issued in 2023 to €3bn in 2024, and Europe was the largest region of the three. A small market, but one that more than trebled in a single year while the wider bond market stood still.
Digital bonds paid for in central bank money
What moved in those trials were digital securities. Across 58 use cases, 64 institutions in nine countries delivered bonds held on a ledger against real euros from the central bank, including Slovenia's first digital sovereign. The permanent service, Pontes, goes live this year.
The ceiling being raised
The EU's DLT venues are the only place a security can be traded and settled on its own register, and each is capped at €6bn today, with no bond above €1bn. In December 2025 the Commission proposed a €100bn ceiling and no per instrument limits at all.
More on digital securities
Related reads from the ONINO blog.
MiFID II and Digital Securities: Compliance Guide
What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
Read Article
How to Issue Digital Securities in the EU: A 2026 Regulatory Guide
Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
Read Article
How No-Code Platforms Enable Digital Securities Issuance
How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
Read Article
ONINO Platform: Digital Securities Infrastructure
What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
Read Article
Regulated Digital Securities Infrastructure Explained
What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
Read Article
Financing Real-World Assets with Digital Securities
From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
Read Article- MiFID II and Digital Securities: Compliance Guide What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
- How to Issue Digital Securities in the EU: A 2026 Regulatory Guide Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
- How No-Code Platforms Enable Digital Securities Issuance How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
- ONINO Platform: Digital Securities Infrastructure What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
- Regulated Digital Securities Infrastructure Explained What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
- Financing Real-World Assets with Digital Securities From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
More on digital securities
Related reads from the ONINO blog.
MiFID II and Digital Securities: Compliance Guide
What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
Read ArticleHow to Issue Digital Securities in the EU: A 2026 Regulatory Guide
Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
Read ArticleHow No-Code Platforms Enable Digital Securities Issuance
How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
Read ArticleONINO Platform: Digital Securities Infrastructure
What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
Read ArticleRegulated Digital Securities Infrastructure Explained
What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
Read ArticleFinancing Real-World Assets with Digital Securities
From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
Read Article- MiFID II and Digital Securities: Compliance Guide What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
- How to Issue Digital Securities in the EU: A 2026 Regulatory Guide Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
- How No-Code Platforms Enable Digital Securities Issuance How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
- ONINO Platform: Digital Securities Infrastructure What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
- Regulated Digital Securities Infrastructure Explained What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
- Financing Real-World Assets with Digital Securities From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
More on digital securities
Related reads from the ONINO blog.
MiFID II and Digital Securities: Compliance Guide
What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
Read ArticleHow to Issue Digital Securities in the EU: A 2026 Regulatory Guide
Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
Read ArticleHow No-Code Platforms Enable Digital Securities Issuance
How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
Read ArticleONINO Platform: Digital Securities Infrastructure
What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
Read ArticleRegulated Digital Securities Infrastructure Explained
What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
Read ArticleFinancing Real-World Assets with Digital Securities
From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
Read Article- MiFID II and Digital Securities: Compliance Guide What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
- How to Issue Digital Securities in the EU: A 2026 Regulatory Guide Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
- How No-Code Platforms Enable Digital Securities Issuance How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
- ONINO Platform: Digital Securities Infrastructure What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
- Regulated Digital Securities Infrastructure Explained What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
- Financing Real-World Assets with Digital Securities From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
More on digital securities
Related reads from the ONINO blog.
MiFID II and Digital Securities: Compliance Guide
What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
Read ArticleHow to Issue Digital Securities in the EU: A 2026 Regulatory Guide
Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
Read ArticleHow No-Code Platforms Enable Digital Securities Issuance
How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
Read ArticleONINO Platform: Digital Securities Infrastructure
What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
Read ArticleRegulated Digital Securities Infrastructure Explained
What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
Read ArticleFinancing Real-World Assets with Digital Securities
From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
Read Article- MiFID II and Digital Securities: Compliance Guide What MiFID II requires for tokenised securities in the EU - obligations, practical implementation, and how the rules apply on-chain
- How to Issue Digital Securities in the EU: A 2026 Regulatory Guide Step-by-step guide to launching a Security Token Offering in the EU. Covers MiCAR, prospectus requirements, BaFin licensing, and operational checklist
- How No-Code Platforms Enable Digital Securities Issuance How no-code platforms remove technical barriers for digital securities issuance. Launch compliant token offerings without developers — from investor onboarding to lifecycle management.
- ONINO Platform: Digital Securities Infrastructure What ONINO is and isn't: financing infrastructure, not crowdfunding, not a blockchain company. How our tokenization platform works for asset managers, banks
- Regulated Digital Securities Infrastructure Explained What regulated financing infrastructure means for digital securities in the EU. BaFin, eWpG, ECSPR & MiCA explained for first-time issuers and investors entering tokenized markets.
- Financing Real-World Assets with Digital Securities From gold to fine art: how real-world assets are financed through digital securities. Practical examples covering commodities, property & collectibles on regulated platforms.
Honest expectations
What the digital form changes, and what it does not
What it changes
- Settlement moves from days to near instant
- Fractional ownership becomes practical at small ticket sizes
- The ownership record is a single source of truth rather than reconciled files
- Transfer restrictions and eligibility checks are enforced in software at the moment of transfer
- Lifecycle events such as coupons and redemptions can be automated
What it does not guarantee
- A secondary market. Liquidity comes from buyers, not from a register
- Investor demand. The form does not make the offering more attractive
- Lighter regulation. The obligations are identical to the paper equivalent
- Cross-border reach. Disclosure below the EU threshold does not passport
- Lower total cost. Disclosure and legal work dominate the budget either way
Honest expectations
What the digital form changes, and what it does not
What it changes
- Settlement moves from days to near instant
- Fractional ownership becomes practical at small ticket sizes
- The ownership record is a single source of truth rather than reconciled files
- Transfer restrictions and eligibility checks are enforced in software at the moment of transfer
- Lifecycle events such as coupons and redemptions can be automated
What it does not guarantee
- A secondary market. Liquidity comes from buyers, not from a register
- Investor demand. The form does not make the offering more attractive
- Lighter regulation. The obligations are identical to the paper equivalent
- Cross-border reach. Disclosure below the EU threshold does not passport
- Lower total cost. Disclosure and legal work dominate the budget either way
Honest expectations
What the digital form changes, and what it does not
What it changes
- Settlement moves from days to near instant
- Fractional ownership becomes practical at small ticket sizes
- The ownership record is a single source of truth rather than reconciled files
- Transfer restrictions and eligibility checks are enforced in software at the moment of transfer
- Lifecycle events such as coupons and redemptions can be automated
What it does not guarantee
- A secondary market. Liquidity comes from buyers, not from a register
- Investor demand. The form does not make the offering more attractive
- Lighter regulation. The obligations are identical to the paper equivalent
- Cross-border reach. Disclosure below the EU threshold does not passport
- Lower total cost. Disclosure and legal work dominate the budget either way
How ownership and transfer actually work
This is the part that distinguishes a digital security from its paper equivalent, and it is where most of the operational saving comes from.
The register is the proof of ownership
With a paper security the certificate is the evidence. With a digital security the register entry is. Whoever the register names is the holder, which removes the reconciliation work that sits between a certificate, a custodian's books and an issuer's own records.
A licensed registrar keeps it, not you
Maintaining a register of securities is a regulated activity in its own right. The permission sits with an authorised registrar, not with the issuer and not with the technology provider. This is the single most misunderstood point on the subject.
Transfer takes effect on the register
Ownership moves when the register is updated, not when a contract is signed or a payment clears. That is what makes near instant settlement possible, and it is also why eligibility checks have to run before the entry changes rather than after.
Custody is a separate function again
A register records who owns what. Custody is safekeeping, and for most instrument and form combinations it sits with a licensed custodian or a depository bank. The two are often confused and are held by different parties.
An ISIN is needed only sometimes
An ISIN is required where the instrument settles through conventional market infrastructure or is admitted to trading. A register held directly can operate without one, though many issuers request one anyway to keep distribution options open later.
FAQ
Questions issuers ask
If your question is not here, the deeper guides linked above go further.
What is a digital security?
Which instruments can be issued as digital securities?
Who maintains the register?
How does a transfer take legal effect?
Does a digital security need an ISIN?
Do the disclosure rules change?
Who holds custody?
Can I issue the same instrument in two forms at once?
What does it cost compared with a conventional issuance?
Can investors sell afterwards?
What is the difference between a crypto security and a central register security?
Are digital securities the same as security tokens?
Since when do digital securities exist in Germany?
RELATED SOLUTIONS
Find Related Solutions
