In a brief but remarkable statement issued July 9, 2025, SEC Commissioner Hester Peirce, leader of the SEC’s Crypto Task Force, warned that “Tokenized securities are still securities.”

Commissioner Peirce’s statement seems directed at several recently-publicized projects to tokenize and create trading markets in both publicly-listed equities as well as shares of unicorn privately-held companies with no public trading markets. Peirce warned that “As powerful as blockchain technology is, it does not have magical abilities to transform the nature of the underlying asset.” She continued, “Accordingly, market participants must consider—and adhere to—the federal securities laws when transacting in these instruments.”

Peirce cautioned that creating a tokenized security may create a “receipt for a security” or a “security-based swap,” each of which is subject to regulation under the federal securities laws. She also reminded distributors of tokenized securities of their disclosure obligations under those laws, and pointed to recent staff guidance on the topic. She encouraged projects sponsors to meet with the Commission and its staff when exemptive relief is necessary.

For years, Commissioner Peirce has been critical of the SEC’s approach to regulating cryptocurrency and other digital assets, and has encouraged a lighter touch to regulation that more greatly fosters innovation. This statement seems to be a realization that there are outer limits to that approach, and serves as a reminder that sponsors of tokenization projects must still consider the regulatory implications of their efforts.