Glossary
Tokenization glossary and security tokens.
The words you will hear when issuing, explained without jargon. Search for one or jump by letter.
This glossary brings together the terms of asset tokenization in Spain, from security token to ERIR, ESI or MiCA, explained in one or two sentences and with the regulation that applies in each case.
Terms in plain English.
- CASP
- Crypto-asset service provider authorized under MiCA. A tokenized security issuance does not need one, because those securities fall outside MiCA. HokenFi is not a CASP. More on CASP →
- CNMV
- National Securities Market Commission. In its public registry, the ERIR of each tokenized issuance is recorded, and that registration does not imply that the CNMV has validated the issuance.
- Commissioner and syndicate of bondholders
- The syndicate groups the holders of a debt issuance to defend their common interests, and the commissioner is the one who represents them before the issuing company. The law requires them in some public debt offerings, and your law firm provides for them in the issuance.
- DLT
- Distributed ledger technology, by its English acronym. Spanish law allows securities to be represented in systems based on it, just as in book entries or certificates. More on DLT →
- Issuance document
- The document prepared by the issuing company with the information needed to identify the securities and the entity that keeps their register. It is mandatory to represent securities on DLT, and in it the ERIR is designated.
- EAF
- Financial advisory firm. It is a type of ESI that can only advise and cannot hold funds or securities of its clients.
- ERIR
- Entity responsible for administering the registration and record of DLT securities. It keeps the issuance register and identifies its holders, and must be an authorized entity. More on ERIR →
- ESI
- Investment services firm, authorized to provide those services. ESIs include securities companies and agencies, portfolio managers and EAFs, and in a tokenized issuance the ESI validates the offering when the law requires it.
- Prospectus
- The disclosure document that must be published, with CNMV approval, before offering securities to the public or admitting them to trading on a regulated market. Below a certain amount, or if the offer is only aimed at qualified investors, it is generally not required. More on Prospectus →
- Qualified investor
- The investor whom the law presumes to have the experience and knowledge to make their own investment decisions and assess their risks, or the one who requests that treatment and meets the requirements. An offering aimed only at qualified investors does not need a prospectus.
- KYB
- The verification of a company before it operates, as per its English acronym (know your business). In HokenFi it is integrated for companies that participate in the platform.
- KYC
- Verification of an investor's identity before they invest, by its English acronym (know your customer). It is part of the anti-money laundering prevention regulated by Ley 10/2010. More on KYC →
- Ley 6/2023 (LMVSI)
- Ley 6/2023, de 17 de marzo, de los Mercados de Valores y de los Servicios de Inversión. It is the Spanish securities framework, allows them to be represented in DLT and makes clear that a tokenized security remains a financial instrument. More on Ley 6/2023 (LMVSI) →
- MiCA
- The European regulation on crypto-asset markets (Regulation (EU) 2023/1114). It does not apply to tokenized financial instruments, such as shares, bonds or promissory notes, which follow securities rules. More on MiCA →
- MiFID II
- The European directive on markets in financial instruments (Directive 2014/65/EU). It defines what a financial instrument is and how investment services are provided, and in Spain it is transposed by Ley 6/2023. More on MiFID II →
- Participatory loan
- A loan whose interest has a variable part linked to the performance of the company receiving it, and which in the order of payment ranks behind ordinary creditors. It is not a security, so an ERIR does not register it.
- Security token
- The market name for a tokenized transferable security: a share, bond or promissory note recorded in a DLT-based registry. It remains a financial instrument, so it is governed by Ley 6/2023 and MiFID II, not MiCA. More on Security token →
- Smart contract
- The program that enforces the token's rules on the chain, such as who it can be transferred to. It does not replace the issuance document. More on Smart contract →
- SPV
- Special purpose vehicle created for a project or an asset. If it is going to issue tokenized shares, it must be a public limited company (sociedad anónima). More on SPV →
- STO
- Security token offering: the placement of tokenized securities with investors. It follows the rules of any securities offering, with or without a prospectus depending on the amount and who it is aimed at. More on STO →
- Appropriateness test
- The assessment of whether an investor understands an investment product. It is carried out by the entity providing an investment service other than advice or portfolio management, such as placement. HokenFi includes the questionnaire so that whoever must apply it can do so.
- Minimum ticket
- The minimum amount each investor can subscribe in an issuance. You decide it and it is written in the issuance document.
- Token
- The digital entry representing a security, or a contract, in a DLT-based registry. It grants the rights of the security or contract it represents. More on Token →
- Tokenize
- Representing a financial instrument in a DLT-based registry. The instrument remains the same, with the same rights; only where it is recorded changes. More on Tokenizing →
- White label
- The portal for your investors with your domain, your logo, your colors and your texts, included in the Scale and Institutional plans and as a plugin in Starter and Growth.
More definitions on the blog
- What is MiCA (Markets in Crypto-Assets Regulation)
- What is MiFID II and why it matters in tokenization
- What is the LMVSI (Ley 6/2023 de Mercados de Valores)
- What is an STO (Security Token Offering)
- What is the CNMV prospectus in a securities offering
- What are KYC and AML (PBC/FT) in a token issuance
- What is the white paper (whitepaper) in MiCA
- What is a transferable security
- What is a smart contract
- What is an IIC (collective investment institution)
- What is the Listing Act and how it affects tokenization
- What is an SGIIC (IIC management company)
- What is a CASP (crypto-asset service provider)
- What is an ART (asset-referenced token) in MiCA
- What is an EMT (electronic money token) in MiCA
- What is an SPV (special purpose vehicle)
- What is TRD or DLT (distributed ledger technology)
- What is a financial instrument (MiFID II)
- Security token
- Crowdlending
- Private equity
- Due diligence of an issuance
- SL or SA to issue
- Family office
- Participatory loan
- Share premium
- Corporate bonds
- Venture debt
- Cap table
- BME Scaleup
- Alternative stock market (BME Growth)
- Shareholders' agreement
- Term sheet
- Token (types and legal regime)
- IPO
- Venture capital
- Equity crowdfunding
- Business angel
- Convertible bonds
- Financing round
- Capital markets
- Digital assets
- Capital increase
- Company valuation
- Scrip dividend
- Trust
- Real estate trust
- Negotiable bonds
- Factoring (factoring)
- Green bonds
- Bond issuance
- Promissory note
- Stock exchange
- RWA (real-world assets)
- Commercial Registry
- OPS (public subscription offering)
- Equity story
- Stock split
- SOCIMI
- MARF (Alternative Fixed Income Market)
- Stock certificates (CEBURES)
- Tag along and drag along
- Subordinated debt and mezzanine
- Financial trust (Argentina)
- What is asset tokenization
- How to issue a security token
Questions
What beginners usually ask.
What is a security token?
A transferable security, such as a share or bond, represented on a DLT-based register. It has the same rights as the non-tokenized security and is governed by Ley 6/2023 and MiFID II.
Is HokenFi an ERIR or an ESI?
No. HokenFi is software by Unknown Gravity. Regulated functions are performed by authorized entities, the ERIR and, when required by law, the ESI. HokenFi does not seek investors or receive funds.
What is the difference between the ERIR and the ESI?
The ERIR registers the issuance and keeps the register of its holders. The ESI validates the offer when required by law, reviewing the information your investors receive and supervising the marketing.
Does MiCA apply to my issuance?
No, if you issue shares, bonds, promissory notes or another financial instrument. A tokenized security remains a financial instrument and is governed by securities rules.
Do I need a prospectus?
In general no, if you raise less than 12 million in the EU over twelve months. It is the threshold of the European Prospectus Regulation as of 5 June 2026, unless Spain opts for 5. Ley 6/2023 still says 8 because it has not been adapted, so your law firm confirms which one applies. You do need the issuance document.
Does the CNMV approve my issuance?
No. The CNMV registers the ERIR as responsible for the registration of your issuance, and that registration does not imply that it has validated the terms or the information.
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