A tokenisation project succeeds or fails on one question: what does the holder actually own? A gold token, a tokenised bond, a property interest and a carbon credit each land in a different place under the Financial Services Act 2025, and the answer decides which licences each party needs. Basnet Law Pte. Ltd., the first law firm incorporated in the Gelephu Mindfulness City, advises issuers, platforms and custodians on tokenisation under the Financial Services Act 2025 and deals with the Gelephu Financial Services Office for them. This page explains how GMC classifies real-world asset tokens and how we structure a launch.
How we help
- Classifying the token by the rights it confers: share, debt instrument, certificate, fund unit, structured product, environmental instrument, spot commodity or virtual asset.
- Structuring the issuance, custody and infrastructure legs so that each sits with a correctly licensed party.
- Advising on the offer route where the token is a security, including the Approved Prospectus requirement and the exempt offers GFSO's Rules prescribe.
- Reviewing whitepapers, launch sites and investor decks against the financial promotions restriction.
- Drafting custody agreements that address whose property the tokens are and how they are identified.
- Preparing the licence applications the structure needs, from dealing and arranging to custody and operating a trading facility.
How tokenisation works in GMC, in plain terms
The Financial Services Act 2025 has no category called a security token. A token is classified by what it represents, using the Act's list of specified investments: a share recorded on a distributed ledger is still a share. The categories most likely to catch a real-world asset token are shares, debt instruments, certificates representing instruments held by someone else, fund units, derivatives, interests in another specified investment, structured products and environmental instruments. The certificates category matters for depository-style tokens, where a custodian holds the underlying instrument and the token conveys rights against it, and a pooled property portfolio whose participants share profits without day-to-day control is a collective investment fund.
A token outside that list is not outside the Act. A virtual asset is a digital representation of value that can be digitally traded and functions as a medium of exchange, unit of account or store of value without legal tender status, and the core activities each extend expressly to virtual assets. A fiat-referenced token, the Act's term for a fiat-backed stablecoin, is separately defined and its issuance is a named regulated activity. A spot commodity is a fungible physical or energy good capable of delivery and traded on a secondary market. A gold token can therefore end up in four places: a certificate over held metal, an entitlement to delivery of physical metal, a cash-settled structured product, or a store-of-value virtual asset.
Anyone who by way of business deals in the token, arranges deals, advises on it, safeguards it for others or runs a venue on which it trades needs a Financial Services Licence unless an exclusion applies. Issuing your own shares or debentures is excluded from dealing, but not running a secondary market. If the token is a security, no offer may be made in GMC without an Approved Prospectus unless it is an exempt offer prescribed in GFSO's Rules; the Act sets no investor-count or minimum-subscription thresholds itself. Whatever the classification, an invitation to engage in investment activity must be communicated or approved by a Licensed Firm or fall within an exemption, and misleading conduct in relation to any specified investment or virtual asset is prohibited.
Custody is where these structures are usually decided. Safeguarding assets belonging to another is regulated whatever the property, and a pooled model in which the client is owed equivalent tokens is still custody. The Act contains no express ring-fence for tokens on a custodian's insolvency: the statutory trust mechanism is for client money, and how tokens are held and segregated is left to the Safe Custody Rules and the custody agreement. The applied insolvency statute applies in GMC through the Application of Laws Act 2024, but there is no reported GMC case law on what token holders own. Algorithmic stablecoin and privacy tokens are barred from any regulated activity, and licensed firms may only handle tokens GFSO has accepted.
The framework is already in use: on 11 December 2025 a gold-backed token called TER launched on the Solana network under a sovereign framework of the Gelephu Mindfulness City, with custody at DK Bank and Matrixdock as technology provider. On tax, the asset securitisation exemption is enacted but comes into operation only on Gazette notification.
Who this is for
- Issuers of gold, metal and commodity-backed tokens deciding what the holder will own.
- Platforms tokenising bonds, private credit, fund interests or real estate.
- Custodians and exchanges that will hold or list tokenised instruments.
- Carbon and renewable energy developers tokenising credits or certificates.
How an engagement runs
- Rights inventory. We write down every right the token confers, map it against the specified investment list and the token definitions, and record the classification with reasons.
- Structure diagram. We allocate the issuance, custody, infrastructure and venue legs to identified entities and confirm which licence or exclusion each relies on.
- Offer and marketing route. Where the token is a security we plan the prospectus or Rules-based exempt offer with GFSO, and we clear promotional material before publication.
- Documents and applications. We draft the token terms, custody agreement and offer documents, and file the licence and Approved Person applications the structure requires.
- Launch and beyond. We support acceptance of the token by GFSO, listing on a licensed venue and the ongoing obligations of each licensed party.
Frequently asked questions
Is a tokenised bond a security in GMC?
If the token creates or acknowledges indebtedness, or confers rights in respect of an instrument that does, it is a specified investment and dealing, arranging, advising, custody and venue operation in relation to it are regulated. The ledger does not change its legal character.
Can I do a private placement of tokenised shares without a prospectus?
The Act disapplies the prospectus requirement for an exempt offer as prescribed in GFSO's Rules, and it does not set the criteria itself. We confirm the current Rules with GFSO before launch.
Can I issue a gold-backed token from GMC?
Yes, but the licensing analysis depends on what the holder owns. The certificates, spot commodity, structured product and virtual asset routes lead to different permissions for the issuer, the venue and the custodian.
Are token holders protected if the custodian fails?
The Act has no express ring-fence for virtual assets; the statutory trust covers client money only. Protection depends on the Safe Custody Rules, the property analysis under the received common law and the custody agreement, which is why we treat that agreement as the most important document.
Talk to GMC counsel on the ground
Basnet Law Pte. Ltd. is the first law firm incorporated in the Gelephu Mindfulness City. A short conversation early in a matter usually saves time and cost later. Write to basnet@basnetgmc.com or office@basnetgmc.com with a few lines about your plans, and we will tell you plainly what is needed, how long it takes, and whether we are the right fit.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
