Asset / commodity token

The instrument is a receipt, not a business

Mechanically this is the simplest structure in tokenization. A custodian holds a unit of the asset. A contract mints one token against that unit and burns the token on redemption. The holder's return, if any, is whatever the asset itself does, because the token adds nothing on top of it.

So the diligence questions are custody questions, not protocol questions. Who holds the metal, under what title, attested how often, and what a holder does on the day the attestation and the token supply disagree. Our RWA tokenization and proof of reserves entries cover both, and neither is optional here, because the claim is the entire product.

Two different things get called a commodity

The label collapses two questions that have separate answers, which is why founders leave this conversation confused. The first is whether the underlying is a commodity. The Commodity Exchange Act defines the term to cover an enumerated agricultural list plus all other goods and articles, and all services, rights and interests in which contracts for future delivery are dealt in.¹ Gold clears that comfortably, and nothing about the token was needed to get there.

The second is how the token itself is treated, which is live rather than settled. On 17 March 2026 the CFTC joined an SEC interpretation of how the federal securities laws apply to crypto assets, providing a taxonomy for digital commodities, digital collectibles, digital tools, stablecoins and digital securities, and stating that certain non security crypto assets could meet the CEA definition of a commodity.² That is Commission level interpretation, current and revisable, not statute.

Keeping the two apart is the practical value of the term. The commodity in the vault and the token pointing at it are analysed separately, and a design that assumes the first answer carries the second has skipped the work.

In the EU the definition does the deciding

Europe answers by definition rather than by asset class. MiCA defines an asset referenced token as a crypto asset that is not an electronic money token and that purports to maintain a stable value by referencing another value or right or a combination thereof, including one or more official currencies.³ The wording is residual and it is broad.

The firm's reading is that a one to one claim on a commodity falls to be assessed under that definition rather than around it, which brings authorisation, reserve and redemption obligations with it. Our asset referenced token entry sets those out. Whether a specific issuance lands there is a question for counsel in the relevant member state.

Yield creep, and why it is one way

The failure we see most often is incremental. A clean asset token ships, then a staking reward is added on top of it, then a share of vault fees is routed to holders, and the team expects the classification analysis to sit where it was. It does not.

A return paid to holders out of someone else's work is the fact pattern an investment contract analysis looks for, and our Howey test entry walks the four elements. Adding it does not open a debate about whether the token changed. It opens one about whether it was ever what you said it was, run backwards over your own marketing.

So the firm's position is a hard one. No yield mechanism at the token layer, no governance rights over the custodied asset, and no pooling of holder capital for a managed return. Where a client wants to offer yield, it goes into a separate instrument with its own structure and its own analysis, and the receipt token stays a receipt.

What has to hold before launch

Three properties, and all three are testable. Backing is verified at the contract level before every mint, so no token can exist without a confirmed unit behind it. Redemption works in practice at a stated size, cadence and cost, not just in the documentation. And any yield or governance layer sits in a separate contract from the token, if it exists at all.

The third gets negotiated away late, usually to make the token attractive to a distribution partner, and that is the moment to slow down. Tokenization changes how a claim settles and who can hold it. It does not manufacture return, and a design that needs manufactured return is telling you the asset underneath is not carrying its weight.

This page is design reference, not legal advice, and not a recommendation to buy, sell or hold anything. Classification is fact specific and jurisdiction specific, and it belongs to your counsel.