Legal Structures of Tokenised Assets

Abstract Tokenised assets are expected to transform finance, yet their legal treatment remains a source of uncertainty. This article presents an analytical framework for categorising legal structures of tokenised assets, addressing a gap in academic literature and regulatory approaches. We introduce a taxonomy based on the legal relationship between tokens and their underlying assets. In complete tokenisation tokens embody legally enforceable rights. It comprises direct tokenisation , where tokens are the primary form of the asset, and indirect tokenisation , where asset-backed tokens are created through intermediary structures. In contrast, incomplete tokenisation results in tokens that function as “digital twins” with limited or no legal value. Our analysis reveals that the effectiveness of tokenisation depends on the robustness of this legal bond. We compare how these categories impact tokenisation features, including asset transferability, legal certainty, and composability. Furthermore, we identify limiting factors in current regulatory frameworks, such as form requirements, ownership models, and identity mechanisms. Drawing examples from various legal systems and asset classes, including financial instruments, property rights, and digital assets, this work provides a foundation for evaluating tokenisation strategies, with practical insights for regulators and market participants.