An Issuer-Sponsored Token (IST) is a digital form of company issued share, administered on a distributed ledger and held by investors in public wallets, while maintaining issuer control, transfer agent oversight, shareholder rights, and regulatory compliance.

Here we answer your most frequently asked questions about the tokenization of securities and Issuer-Sponsored Tokens.

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Peter Duggan
By Peter Duggan, EVP, Client Relationship, Issuer Services

How do Issuer-Sponsored Tokens differ from wrappers and custody tokens?

When an investor holds an Issuer-Sponsored Token, they are not holding a wrapper/ derivative which is a third-party tokenized security nor are they holding beneficial entitlement to a security. They are a registered shareholder, with the same rights as any other registered holder for dividends, voting and corporate actions.

The token is not linked to the share – it is the share.

Feature Issuer-Sponsored Token Wrapper Custodized Token
Share on issuer register Yes No Only custodian’s nominee appears (not beneficial owners) i.e. for DTC through its nominee Cede & Co.
One token = one share Yes Varies Yes
Direct issuer relationship Yes Possibly but not common No
Transfer agent oversight – infrastructure, compliance, reporting standards Yes Depends on jurisdiction of SPV No
Supports DRS operability Yes No Yes
Shareholder rights are maintained – voting, dividends Yes Depends on provider and terms of wrapper Yes (although some aspects may differ)
Corporate actions are supported Yes Depends on provider and terms of wrapper Yes (although some aspects may differ)

 

What are the benefits of tokenized securities for investors?

For investors, the tokenization of securities delivers:

  • Check circle iconA new way to hold public equity alongside digital assets in a public wallet
  • Check circle iconGlobal, near‑instant, peer‑to‑peer transfer capability
  • Check circle iconFewer intermediaries between the shareholder and the issuer

It meets the growing demand from digitally native investors without forcing issuers or the market to change how equity fundamentally works.

What are the benefits of Issuer-Sponsored Tokens for issuers?

For issuers, Issuer-Sponsored Tokens offer:

  • Check circle iconMore choice in how shareholders hold their shares
  • Check circle iconClear visibility into token holder
  • Check circle iconAccess to new, often global, investor segments

Issuer-Sponsored Tokens give companies a controlled alternative to unauthorized third‑party tokenization that could otherwise impact governance, investor experience, or brand.

How do Issuer-Sponsored Tokens work with DRS?

Issuer-Sponsored Tokens are designed for interoperability. Investors can move freely between:

  • Check circle iconDRS and token form
  • Check circle iconToken form and DRS
  • Check circle iconDRS and brokerage (DTCC), as they do today

Blockchain transfers can occur continuously, while dividends, proxies, and corporate actions initially continue through established processing. That balance allows progress without operational disruption. Over time, distribution of dividends through stable coins, voting on-chain and distribution of tokens for other corporate actions will be developed.

Are Issuer-Sponsored Tokens regulated?

Issuer-Sponsored Tokens retain transfer agent protections. Tokens can be recovered in cases of fraud or lost credentials. Identity verification, recordkeeping, and investor protection obligations continue to apply.

With Issuer-Sponsored Tokens, the transfer agent, such as Computershare, retains responsibility for the master security holder file. Regulatory guidance allows that record to be maintained across multiple databases. That enables the transfer agent to connect traditional shareholder records with blockchain activity, while maintaining auditability, oversight, data security and control.

Issuer-Sponsored Tokens are not about replacing today’s capital markets. They are about extending them – securely, responsibly, and in a way that bridges traditional infrastructure with what comes next.

Let’s talk

If you would like to explore Issuer-Sponsored Tokens for your company, please reach out to your Relationship Manager or contact Computershare.

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