Security Token
A blockchain token that represents ownership of a real-world asset or investment contract.
In-Depth Explanation
Security tokens are regulated financial instruments on-chain: tokenized equity, debt, real estate, or revenue shares. Unlike utility tokens, security tokens explicitly provide economic rights and must comply with securities laws. They promise traditional asset benefits (dividends, ownership) with blockchain advantages (programmability, 24/7 markets).
Related Terms
Security Token Offering
STOA regulated token sale where tokens represent ownership in real-world assets or equity.
Tokenization
Converting ownership rights in real-world assets into blockchain tokens.
Utility Token
A token designed to provide access to a product, service, or functionality within a specific ecosystem.
More in Tokenomics
View all →Emissions
New tokens distributed by a protocol as incentives, typically to liquidity providers or users.
Liquidity Mining
Earning token rewards by providing liquidity to a DeFi protocol.
Token Buyback
When a protocol uses revenue to purchase its own token from the open market, reducing circulating supply.
Dividend
Direct distribution of protocol revenue to tokenholders, typically in ETH, stablecoins, or the protocol's native token.