From the floor of the New York Stock Exchange during a pivotal Fed week, Ron Geffner, one of the most respected securities lawyers in the industry, offered a high-level perspective on the rapid digitalization of capital markets and the growing institutionalization of crypto and tokenized assets. Geffner explained that one of the most significant developments underway is the tokenization of real-world assets—creating digital representations of beneficial ownership in assets such as real estate, gold, bonds, and other securities through blockchain-based structures.
He emphasized that while tokenization is accelerating globally, U.S. securities laws—rooted in frameworks established in the 1930s and reinforced by the Supreme Court’s 1946 Howey Test—remain the benchmark for determining whether a digital asset qualifies as a security. This creates tension between innovation and regulation, particularly as the U.S. attempts to balance investor protection with competitiveness in a global race for crypto leadership.
Geffner noted that the SEC, by nature, tends to be reactive rather than proactive, often addressing emerging risks after markets have already evolved. As a result, issuers must be extremely cautious. He stressed that any token offering should be carefully reviewed by legal counsel to determine whether registration is required, what exemptions may apply, and whether disclosures accurately reflect investors’ rights—especially when assets are held through special purpose vehicles (SPVs), where token holders may only have indirect, off-chain enforcement rights.
He also highlighted the complexity of cross-border token offerings, where anti-money-laundering and “know your client” standards vary significantly by jurisdiction, increasing compliance risk if not properly addressed.
On the institutional side, Geffner confirmed that appetite for crypto exposure among fund managers continues to grow. Based on his firm’s global fund practice, cryptocurrency is no longer viewed as a fringe or retail-only asset class, but as an increasingly mainstream component of diversified, institutional portfolios.
Overall, his message was clear: tokenization is here to stay, institutional adoption is expanding, but legal structure, transparency, and investor protection remain critical for sustainable growth.
