Digital Asset Toolkit: Token Analyses, Custody Terms, and Disclosure Language

Document type: Toolkit Practice area: Corporate — Securities Jurisdiction: United States (federal and state) Last reviewed: 5 September 2026

How to use this toolkit

Two ordering principles run through everything here.

First, money transmission before securities. It applies more broadly, it is criminal under 18 U.S.C. § 1960, and state licensing takes eighteen months. Companies that reverse the order discover the problem at launch.

Second, transactions rather than tokens. "Is our token a security" is a malformed question. Every worksheet below is applied per transaction.

Tool 1 — Money transmission determination worksheet

MONEY TRANSMISSION / MSB DETERMINATION
[Company] — [Date] — Prepared by [ ] — Privileged

THE FIVE QUESTIONS
  1. Do we ever hold customer funds or assets, even momentarily?
     Y / N  — how: ______________________
  2. Do we move value between persons?               Y / N
  3. Do we convert between assets, or asset/fiat?    Y / N
  4. Do we control keys that can move someone else's
     assets?                                          Y / N
  5. Do we operate any custodial wallet, escrow, or
     settlement function?                             Y / N

ARCHITECTURE DESCRIPTION  (signed off by Engineering)
  Where do assets sit at each step of every user flow?
  ______________________________________________________
  Who holds which keys, and what can each key do?
  ______________________________________________________
  Is there ANY flow in which we can move a user's assets?
  ______________________________________________________
  Engineering sign-off: ____________  Date: ________

FEDERAL CONCLUSION
  [ ] Money services business — money transmitter
  [ ] Not an MSB — basis: ______________________
      ** CONDITIONAL on the architecture above. Any change to
         custody or key control REOPENS this determination. **
      Standing engineering constraint recorded:  [ ] Yes

IF MSB
  [ ] FinCEN registration filed: ________
  [ ] AML program per 31 U.S.C. § 5318:
        [ ] Compliance officer designated: ____________
        [ ] Written policies and procedures
        [ ] Training program
        [ ] ** Independent testing ** — last: ______
  [ ] Customer identification program
  [ ] Recordkeeping / travel rule
  [ ] SAR process and filings

STATE LICENSING MAP
  State | Required? | Applied | Granted | Bond | Net worth |
  Restricted pending?
  [ ] Digital-asset-specific frameworks checked
  [ ] Availability restricted TECHNICALLY where pending

Annotation. The bolded conditional is the point of the worksheet. Most non-custodial conclusions are true when written and false eighteen months later, because a product team shipped a feature that touches user assets. Recording the conclusion as a standing engineering constraint — reviewed at design time, not in an annual legal refresh — is what keeps it accurate.

Tool 2 — Transaction inventory

TRANSACTION INVENTORY — [Asset]

 # | Transaction              | Counterparty | What they give |
   | What we give | What we said | What they rely on us for
---|--------------------------|--------------|----------------|
 1 | Seed / institutional sale|              |                |
 2 | Public sale (if any)     |              |                |
 3 | Distribution for services|              |                |
 4 | Airdrop / incentive      |              |                |
 5 | Treasury sales           |              |                |
 6 | Exchange listing         |              |                |
 7 | Secondary trading        |              |                |
 8 | Use to pay for service   |              |                |
 9 | [other]                  |              |                |

For EACH row, run Tool 3. Do not run it once for "the token."

Annotation. The last two columns — what we said, and what they rely on us for — are the ones that decide cases, and they are the ones that never appear in a token's legal analysis. Fill them from the actual record: the pitch deck, the whitepaper, the Discord, the founder's podcast appearance. If those columns are uncomfortable to complete honestly, that discomfort is the analysis.

Tool 3 — Howey worksheet (one per transaction)

TRANSACTION #___: ______________________

1. INVESTMENT OF MONEY
   What did the counterparty give up?
     [ ] Cash / other assets: ______
     [ ] Services or effort: ______
     [ ] Data, a lockup, forgone alternatives: ______
     [ ] Nothing
   Element satisfied?  Y / N / arguable — why: ______

2. COMMON ENTERPRISE
   Horizontal — pooled funds, pro rata sharing?   Y / N
   Vertical — fortunes tied to promoter's efforts/fortunes? Y / N
   Circuit standard applicable: ______
   Element satisfied?  Y / N / arguable — why: ______

3. REASONABLE EXPECTATION OF PROFITS
   What actually motivated the counterparty?
     [ ] Capital appreciation
     [ ] Participation in earnings from use of funds
     [ ] Use or consumption of the thing purchased  ← Forman
   EVIDENCE (not assertion): marketing, pitch materials, public
   statements, discount to utility price, quantities purchased
   relative to plausible personal use, whether the network exists:
   ______________________________________________________
   NOTE: a FIXED return is still a profit — SEC v. Edwards.
   Element satisfied?  Y / N / arguable — why: ______

4. DERIVED FROM THE EFFORTS OF OTHERS
   Whose efforts are the undeniably significant ones?  ______
   What do holders expect that person to do?  ______
   Run the DECENTRALIZATION SCORECARD (Tool 4).
   Element satisfied?  Y / N / arguable — why: ______

CONCLUSION for this transaction: ______________________
LOAD-BEARING FACTS: ______________________________________
WHAT WOULD CHANGE IT: ____________________________________

ALSO SCREEN THIS TRANSACTION FOR:
  [ ] Reves note analysis (lending / yield / interest-bearing)
  [ ] CEA: commodity characterization; § 9 spot antifraud reach
  [ ] Retail leveraged commodity transaction rules
  [ ] Money transmission
  [ ] State blue sky
  [ ] Tax characterization
  [ ] Sanctions

Annotation. Element 3's evidence line is the one that separates a real analysis from a hopeful one. United Housing Foundation, Inc. v. Forman, 421 U.S. 837 (1975) turns on what purchasers were actually motivated by, and the honest evidence — a token sold at a discount to future utility, in quantities nobody could consume, for a network that does not exist — usually points one way. Write what the evidence shows, not what the client would prefer.

Tool 4 — Decentralization scorecard

DECENTRALIZATION SCORECARD — [Asset] — [Date]

DEVELOPMENT
  Independent contributors (last 12 mo): ____
  Distinct organizations contributing: ____
  Who merges code: ______________
  Who publishes the roadmap: ______________
  Company share of commits: ____%

GOVERNANCE AND UPGRADE AUTHORITY
  Can the protocol be changed?  By whom: ______________
  Admin keys / upgrade keys / pause functions exist?  Y / N
    Held by: ______________  Quorum: ______
  Token-weighted governance?  Insider share of voting power: ____%
  ** A multisig upgrade key held by the founding team = holders
     are relying on that team. **

TOKEN DISTRIBUTION
  Founders ____%  Company ____%  Foundation ____%
  Investors ____%  Ecosystem ____%  Public ____%
  Vesting status of each: ______________
  Top 10 holders control: ____%

ECONOMICS
  Does the company still fund development?  Y / N
  Does the company capture value from network activity? Y / N
  Foundation independent in fact?  Directors: ______________

PUBLIC COMMUNICATIONS  (the dimension we control and manage worst)
  Statements in the last 12 months about: roadmap ___ listings ___
  partnerships ___ burns/buybacks ___ supply ___ price ___
  Archive reviewed?  [ ]   Problem statements identified: ______

ACTUAL USE
  Share of activity that is genuine third-party utilization: ____%
  Method of measurement: ______________

ASSESSMENT: ______________________________________________
DIRECTION OF TRAVEL: more / less decentralized than 12 mo ago
RE-MEASURE ON: ____________

Annotation. Three cautions belong with this tool. Decentralization is not a status you declare; it is a set of facts a fact-finder assesses. It moves backwards — a reintroduced upgrade key or a re-consolidated development team undoes it. And it does not retroactively cure the initial sale: the original transaction is analyzed on the facts as they were then, which surprises issuers who assume maturity fixes the launch.

Tool 5 — Token analysis memorandum outline

TOKEN ANALYSIS MEMORANDUM
[Company] — [Asset] — [Date] — Version ___ — PRIVILEGED

1.  SCOPE, ASSUMPTIONS, AND LIMITATIONS
2.  FACTUAL BACKGROUND
      The company · the network · what the asset does today ·
      what it will do · supply and distribution · governance and
      upgrade authority · public communications (with the
      difficult ones quoted, not summarized)
3.  MONEY TRANSMISSION AND BSA STATUS          [Tool 1]
4.  TRANSACTION-BY-TRANSACTION SECURITIES ANALYSIS
      4.1 [Transaction 1]  — Howey worksheet reproduced
      4.2 [Transaction 2]
      ... one section per transaction
5.  NOTES ANALYSIS (Reves) — where applicable
6.  COMMODITY EXCHANGE ACT ANALYSIS — including § 9 spot reach
7.  STATE LAW — money transmission, blue sky
8.  INVESTMENT COMPANY AND ADVISER STATUS
9.  TAX CHARACTERIZATION
10. SANCTIONS AND CONSUMER PROTECTION
11. ADVERSE AUTHORITY AND ADVERSE FACTS
      ** Required section. What is the government's best argument?
         What facts would we least like to explain? **
12. LOAD-BEARING FACTS AND TRIGGERS FOR RE-ANALYSIS
13. CONCLUSIONS AND RECOMMENDATIONS

Version history: ____________
Next scheduled review: ____________
Events requiring immediate review: governance change · upgrade
authority change · new product · new listing · material treasury
sale · regulatory contact

Annotation. Section 11 is not optional and it is the section that most distinguishes a memorandum written for the client's comfort from one written to be useful. A memorandum that omits the founder's tweet about price is marketing; the tweet will be found. Write for the enforcement lawyer, and the document also satisfies the acquirer, the listing committee, and the board.

Tool 6 — Whitepaper review checklist and model risk factors

WHITEPAPER REVIEW

MUST BE ACCURATE
  [ ] Total supply and issuance schedule
  [ ] Allocations: founders / company / foundation / investors /
      ecosystem / public — with vesting
  [ ] What can change the schedule, and who decides
  [ ] What the token does TODAY (present tense)
  [ ] What it will do (future tense, clearly labeled, qualified)
  [ ] Who can change the protocol; upgrade/admin keys; pause powers
  [ ] Funds raised and use of proceeds
  [ ] Team, roles, and their holdings

MUST BE REMOVED
  [ ] Price projections or targets
  [ ] Return, yield, APY, or "passive income" language
  [ ] Comparisons to other assets' price performance
  [ ] "Investment," "investors," "ROI" framing
  [ ] Listings not yet agreed
  [ ] Burn / buyback / deflationary claims we cannot control or
      that function as a return
  [ ] Claims about scarcity driving value

SEPARATE DOCUMENTS
  [ ] Whitepaper = technical and product
  [ ] Private placement memorandum = risk disclosure
      (One document cannot be both.)

MODEL RISK FACTORS (adapt; do not use as boilerplate)

REGULATORY CHARACTERIZATION.  The regulatory treatment of the
Tokens is uncertain and evolving. [Company] has analyzed the
Tokens under applicable law and reached the conclusions described
herein, but a court or regulator could disagree. If the Tokens or
transactions in them were determined to be securities, the
consequences could include rescission rights, penalties,
restrictions on transfer, delisting, and material limitations on
the Network's operation.

DEPENDENCE ON [COMPANY].  The Network's development currently
depends on [Company]. [Company] controls [describe: the code
repository / upgrade keys / the roadmap]. There is no assurance
that [Company] will continue to develop the Network, that
development will succeed, or that control will be distributed as
described.

NO REDEMPTION OR CLAIM.  Tokens do not represent equity, debt, or
any claim on [Company]'s assets or revenues. Holders have no
right to redemption and no right to any distribution.

LIQUIDITY AND VOLATILITY.  There may be no market for the Tokens.
Any market may be illiquid, volatile, or subject to manipulation.

TECHNOLOGY.  Smart contract vulnerabilities, consensus failures,
key loss, and network attacks may result in total loss.

TAX.  Receipt, holding, and disposition of Tokens may have tax
consequences, including income on receipt. Holders should consult
their own advisers.

CONCENTRATION.  [__]% of supply is held by [Company], the
Foundation, and insiders. Sales by such holders could materially
affect any market price.

Annotation. The first risk factor is the one issuers most want to delete and the one most worth keeping. Disclosing that the characterization is uncertain and that the company reached a conclusion a regulator might reject is both accurate and protective — and its absence, in a document that confidently asserts the asset is not a security, is itself a misstatement problem.

Tool 7 — Communications policy

[COMPANY] DIGITAL ASSET COMMUNICATIONS POLICY

APPLIES TO: all employees, contractors, advisers, community
managers, and ** founders **, in every forum — X, Discord,
Telegram, Reddit, podcasts, conference stages, group chats,
private DMs conducted in a company capacity.

NEVER
  · Price. Targets, predictions, commentary, "undervalued,"
    retweets of price analysis, emoji that mean price.
  · Returns, yield, APY, passive income, "put in / get out."
  · Listings not yet publicly and definitively agreed.
  · Supply mechanics as a value proposition (burns, buybacks,
    deflation) — describe mechanics factually, never as a reason
    the asset will appreciate.
  · Guarantees of any future development.

ALWAYS
  · Label plans as plans, with dates and qualifications.
  · Distinguish what exists from what is planned.
  · Route anything public through [approver] before posting.
  · Assume permanence and hostile reading.

APPROVAL PATH
  Draft → [Comms] → [Legal] → post.  Emergency path: ____________

COMMUNITY TEAM
  Trained on: ______  Refresher cadence: ______
  Escalation: any price/return/listing question → do not answer,
  route to [ ].

ARCHIVE
  All channels archived, retained ___ years, searchable.

ENFORCEMENT
  Violations reported to ______. Applies to founders. Consequences:
  ______________________

Annotation. The parenthetical emphasis on founders is deliberate: the policy exists because of founders, and a policy that everyone believes does not apply to the chief executive is not a policy. A single founder post about price can outweigh a hundred pages of legal analysis in an efforts-of-others assessment.

Tool 8 — Treasury sale and insider trading policies

TREASURY SALE POLICY

APPROVAL:  Committee: ______________  Quorum: ____
           Legal represented: [ ] required

PERMITTED TRIGGERS  (anything else → Board)
  [ ] Operating runway below ____ months
  [ ] Budgeted ecosystem grant, pre-approved
  [ ] Defined liquidity provision program

LIMITS
  Max per period: ______   Max % of trailing 30-day ADV: ____%
  No sales into a market with < ______ depth

BLACKOUTS — no sales in the ___ days before:
  listing announcements · governance changes · partnerships ·
  incident disclosures · financings · protocol upgrades

METHOD  (pre-adopted non-discretionary preferred)
  [ ] Scheduled program adopted [date], executed mechanically
  [ ] OTC with buyer lockup of ___ days
  [ ] On-venue within pacing limits

DISCLOSURE
  [ ] Pre-announced  [ ] Post-reported  [ ] Not disclosed
  NOTE: silence + visible on-chain movement is worse than
  disclosure. The community reconstructs it anyway.

RECORD (every sale)
  Date | Amount | Counterparty | Method | Approver | Trigger

INSIDER TRADING POLICY — DIGITAL ASSETS

COVERED PERSONS: founders, employees, contractors, advisers,
board members, and their immediate families and affiliates.

MATERIAL NON-PUBLIC INFORMATION includes: pending listings or
delistings; protocol changes and upgrade timing; partnerships;
security incidents; treasury transactions; funding; supply changes.

PROHIBITED
  · Trading the Token, or any related asset, while in possession
    of MNPI.
  · Tipping.
  · Trading in the ___ days before a scheduled announcement.

REQUIRED
  · Disclose holdings on joining and annually.
  · Pre-clear all transactions with [ ].
  · Observe blackout periods: ______________

NOTE: Insider trading in digital assets has been charged under
both securities and wire fraud theories. The company's own
exposure depends on whether this policy existed and was enforced.

Annotation. The most consequential line in the treasury policy is the pacing limit tied to trailing average daily volume. Treasury sales become a story when they are large relative to the market, and a percentage-of-volume constraint prevents the transaction that a founder under cash pressure would otherwise authorize on a Friday.

Tool 9 — Listing committee analysis form

LISTING ANALYSIS — [Asset]              Committee date: ______

1. ASSET AND ISSUER
   Issuer / promoter, if identifiable: ______________
   Original distribution: date, structure, amount raised, to whom
   Was the original distribution a securities offering?  Y / N /
   arguable — analysis: ______________

2. DECENTRALIZATION  [attach Tool 4 scorecard]
   Development ____ Governance ____ Upgrade authority ____
   Concentration ____ Economics ____ Communications ____
   Actual use ____

3. ISSUER COMMUNICATIONS
   Recent statements about roadmap, price, listings, supply:
   ______________________________________________________

4. CHARACTERIZATION
   Securities analysis: ______________
   Commodity analysis (incl. § 9 spot antifraud reach): ______
   If listed, do we become an exchange (15 U.S.C. § 78c / § 78f)
   or a broker (§ 78o)?  ______________

5. OTHER REGIMES
   Money transmission ____ Sanctions ____ State law ____

6. MARKET INTEGRITY
   Liquidity ____ Holder concentration ____ Venue depth ____
   Known manipulation or wash trading indicators ____

7. LOAD-BEARING FACTS AND MONITORING PLAN
   Facts the conclusion depends on: ______________
   Who monitors: ______  How often: ______

8. ** DELISTING TRIGGERS (agreed NOW, before listing) **
   [ ] Regulatory action against the issuer
   [ ] Material change in control or governance
   [ ] Upgrade authority reintroduced or concentrated
   [ ] Monitoring criteria failure
   [ ] Liquidity below ______
   [ ] Integrity event

DECISION: [ ] List  [ ] Decline  [ ] Defer pending ______
Approver: ____________  Minutes recorded: [ ]
Re-review date: ____________

Annotation. Section 8 is the section that has to be completed before listing, because triggers agreed in advance can actually be pulled. Triggers debated after an asset has become a meaningful revenue line are triggers that never fire — which is how venues end up listing assets they can no longer defend.

Tool 10 — Custody terms and three-document reconciliation

CUSTODY TERMS — MODEL PROVISIONS

OWNERSHIP.  All Digital Assets credited to a Customer Account are
the property of the Customer. [Firm] holds such Digital Assets for
the benefit of the Customer and does not acquire any right, title,
or interest in them.

NO USE.  [Firm] will not sell, lend, pledge, hypothecate,
rehypothecate, transfer, or otherwise use Customer Digital Assets,
or grant any security interest in them, for its own account or the
account of any other person.

SEGREGATION.  [Firm] will hold Customer Digital Assets segregated
from its own assets and will maintain books and records
sufficient to identify each Customer's entitlement at all times.

INSOLVENCY.  Customer Digital Assets are not property of [Firm]
and are not available to [Firm]'s creditors.

[If any of these statements is not true of the operations, DO NOT
include it. Change the operations or change the statement.]

THREE-DOCUMENT RECONCILIATION

                        | TERMS SAY | OPERATIONS DO | ACCOUNTING
------------------------|-----------|---------------|-----------
Who owns the assets     |           |               |
Segregation             |           |               |
Right to use / lend     |           |               |
Commingling in fact     |           |               |
Key custody and quorum  |           |               |
Individual entitlement  |           |               |
  reconstructable       |           |               |
Insolvency treatment    |           |               |

** ANY DISAGREEMENT MUST BE RESOLVED BY CHANGING THE DOCUMENTS OR
   THE OPERATIONS — NOT BY PICKING A FAVORITE. **

Reconciled by: ______  Date: ______  Counsel: ______
Insolvency opinion by counsel who has litigated one: [ ]

PROOF
  [ ] Reserve attestation / proof-of-reserves — frequency ______
  [ ] Independent examination — provider ______  standard ______
  [ ] Internal reconciliation cadence ______

Annotation. The bracketed instruction in the model provisions is the entire tool. These clauses are commonly copied into terms of service by companies whose operations do not match them — commingled omnibus wallets, key control that permits firm use, records from which individual entitlements cannot be reconstructed. A terms of service that promises segregation the operations do not deliver is a misrepresentation before it is anything else, and in an insolvency it converts into a very expensive dispute about whether customers are owners or creditors.

Tool 11 — Stablecoin reserve disclosure

RESERVE DISCLOSURE — [Coin] — as of [date]

THE PROMISE
  [ ] Redeemable at par in [currency], on demand
  [ ] Over-collateralized by digital assets at ___%
  [ ] Maintained algorithmically — mechanism: ______

RESERVE COMPOSITION
  Asset class | Amount | % | Weighted avg maturity | Custodian
  ------------|--------|---|-----------------------|----------
  Cash / deposits
  Government obligations (≤ __ days)
  Repos
  Other: ______

  Total reserves: $______   Tokens outstanding: ______
  Coverage: ____%

WHERE HELD
  Institution | Amount | In whose name | Segregated? | Insured?

SEGREGATION AND BANKRUPTCY REMOTENESS
  Mechanism: [ ] Trust  [ ] SPE  [ ] State trust charter
             [ ] Other: ______
  Opinion of counsel obtained?  [ ]

CLAIMS
  Who has a claim on reserves, in what priority: ______
  Shortfall waterfall: ______

REDEMPTION
  Legal right or discretionary practice? ______
  Timeline ____  Minimum ____  Fees ____
  Can it be suspended?  Under what conditions: ______

ASSURANCE
  Type: [ ] Audit  [ ] Examination  [ ] Agreed-upon procedures
        [ ] Management assertion with accountant's report
  Provider ______  Standard ______  Frequency ______
  ** Describe this ACCURATELY in public materials. A management
     assertion is not an audit. **

CURRENT LAW CHECK
  Federal payment stablecoin framework status as of [date]: ______
  Confirmed by counsel: ______

Annotation. The assurance block's warning addresses the most common disclosure failure in this product category. Companies describe an agreed-upon-procedures engagement or a management assertion as an "audit," and the gap between the two is exactly the gap a regulator or a plaintiff will exploit. Say what was examined, by whom, and to what standard, in the words a professional would use.

Tool 12 — Launch readiness sign-off

LAUNCH READINESS — [Asset] — Target date: ______

MONEY TRANSMISSION
  [ ] Determination current (Tool 1); architecture unchanged
  [ ] Licenses in place OR availability restricted technically
  [ ] AML program live; independent test scheduled
  Owner: ______  Sign-off: ______

SECURITIES
  [ ] Transaction inventory complete (Tool 2)
  [ ] Howey worksheet per transaction (Tool 3)
  [ ] Memorandum current and dated (Tool 5)
  [ ] Exemption complied with; Form D and state notices filed
  [ ] Resale restrictions designed and implemented
  Owner: ______  Sign-off: ______

DISCLOSURE
  [ ] Whitepaper reviewed (Tool 6); prohibited content removed
  [ ] Separate PPM final
  [ ] Risk factors specific, not boilerplate
  Owner: ______  Sign-off: ______

COMMUNICATIONS
  [ ] Policy adopted and trained (Tool 7)
  [ ] ** Every channel inside the approval flow ** — including
      the Discord nobody mentioned
  [ ] Archive live
  Owner: ______  Sign-off: ______

CONTROLS
  [ ] Sanctions screening of persons AND addresses, tested
  [ ] Geographic restrictions technical, not attestation
  [ ] Customer identification, if applicable
  Owner: ______  Sign-off: ______

TREASURY AND INSIDERS
  [ ] Treasury policy approved (Tool 8)
  [ ] ** No unrestricted sale path exists **
  [ ] Insider trading policy adopted; holdings disclosed
  Owner: ______  Sign-off: ______

DEPENDENCIES
  [ ] Banking in place  [ ] Insurance bound  [ ] Auditor engaged

INCIDENT
  [ ] Incident plan written; commander named
  [ ] Litigation hold procedure covers Discord, Telegram, and
      personal devices used for company business

FINAL APPROVAL: ____________  Date: ______
Next memorandum review: ____________

Annotation. Two items on this form are there because they are what actual readiness reviews catch: a communications channel outside the approval flow, and an unrestricted treasury sale path. Both are invisible in a legal analysis and obvious in an operational walkthrough. Do the walkthrough.