Token Law: Legal Frameworks, Regulatory Compliance, and Liability Insights

Andrew Lucas | Perkins Coie

Andrew focuses his practice on virtual currency matters. Andrew Lucas most recently served as counsel for the New York State Department of Financial Services, Research and Innovation Division, (NYDFS) where he led a team handling licensure, supervision, and examination of virtual currency companies.

Andrew works with a range of fintech and digital business clients on federal and state regulatory, compliance and enforcement matters, and complex bank regulatory issues, as well as contract drafting and negotiation. Through his leadership role at NYDFS, Andrew developed a deep knowledge of the virtual currency market. He also established relationships with leading industry figures, in both the public and private sectors.

Andrew also provides advice and counsel on cybersecurity concerns. While at NYDFS he supervised cybersecurity specialists conducting reviews of complex institutions across all NYDFS divisions.

Prior to his work at NYDFS, Andrew was senior counsel in the New York Law Department, Legal Counsel Division, advising the mayor’s office, the city council, and agency executives on legal and policy issues. At the New York Law Department, Special Federal Litigation division, he served as lead attorney on the team handling constitutional claims from the Occupy Wall Street protests.

Ross Handler | Perkins Coie

Ross provides legal guidance to fintech, nonbank, and financial services institutions, ensuring compliance with federal and state finance laws. Ross Handler advises clients on laws related to money transmission, consumer and commercial lending, and payments constructs.

Ross brings extensive experience in drafting, negotiating, and executing corporate transactional agreements in consumer and commercial payments matters. This includes incentive deals between merchants and card networks, bank partnership agreements, cobranded credit card agreements, and payment processing agreements for global retailers. He also provides regulatory counsel for payments constructs such as gift cards, payroll, marketplace solutions, and payment processing.

Additionally, Ross served as second counsel to a global payment facilitator in its Payments Risk Legal and Money Movement Services and Payouts groups, where he interacted with platform users to support new customer-facing payments products and services.

I. Understanding Tokens and Their Legal Framework | 1:00pm – 1:45pm

• Defining Tokens: Utility vs. security vs. governance tokens
• The Technology Behind Tokens: Smart contracts and blockchain basics
• Token Issuance and Distribution Models: ICOs, STOs, and Airdrops
• Key Regulatory Classifications: How tokens are viewed under U.S. law

II. Securities and Compliance Issues in Tokenization | 1:45pm – 2:40pm

• SEC and the Howey Test: When is a token a security
• Commodity vs. Security Distinction: CFTC vs. SEC jurisdiction

Break | 2:00pm – 2:10pm

• AML & KYC Compliance: Regulatory requirements for token issuers
• Recent Enforcement Actions and Legal Precedents

III. Key Contractual and Liability Considerations | 2:40pm – 3:10pm

• Liability Issues in Token Transactions and Fraud Risks
• Consumer Protection and UDAP (Unfair and Deceptive Acts and Practices)