This article is about the tokens of play-to-earn (P2E) games, where players earn tokens and can withdraw them into money. It covers how US and EU regulators tell an in-game currency from a security and from a payment instrument, which features matter for that, and what a game studio should fix in its tokenomics and game terms. Everything is based on primary sources: regulators’ decisions and interpretations, their guidelines and EU acts.
Checked on 23 October 2026. Rules and sources are current as of this date.
What tokens exist in P2E and why it matters
One game usually has several tokens, and each raises its own legal question. You cannot draw one conclusion about the project’s token. Each must be analysed.
In-game currency
A token used to pay for items and upgrades inside the game. The key question is whether it can be withdrawn into ordinary money. If not, it is a closed system. If yes, payment rules come in.
Game items and NFTs
Characters, land and weapons as NFTs (non-fungible tokens, unique digital assets). The question is whether the studio sells an item for use in the game or promises owners income from the project’s development.
Project or governance token
A token whose price rises if the game succeeds and which gives a vote in governance. This is the one that most often draws regulators’ attention, because it resembles a stake in the project.
Our basis
For the US it is the interpretation of the SEC (US Securities and Exchange Commission) of 17 March 2026 and its cases against NFT issuers. For the EU it is MiCA (the EU Markets in Crypto-Assets Regulation) and the guidelines of ESMA (the European Securities and Markets Authority).
| Token | Main question | Who is interested |
|---|---|---|
| In-game currency | Whether it can be withdrawn into money, and at what rate | Payment regulators, FinCEN (the US financial intelligence unit) |
| Game item, NFT | A usable item or a promise of income | SEC, MiCA for unique assets |
| Project token | Players expecting the price to rise through the studio’s efforts | SEC, ESMA and national regulators |
| Stablecoin inside the game | Whether it is pegged to an official currency | Payment regulators in the EU and US |
United States: when an investment contract forms around a token
In the US a token does not become a security by itself. It happens when a deal forms around the token that the SEC calls an investment contract.
The SEC’s 2026 interpretation
On 17 March 2026 the SEC published an interpretation (Release 33-11412) with a token taxonomy. Digital collectibles, which expressly include in-game items, and digital tools such as a membership or ticket are not themselves securities. Chairman Atkins said most crypto assets are not securities.
But a contract around the token is possible
A token that is not a security can become the subject of an investment contract. This happens when the issuer offers it to raise money and promises efforts from which buyers reasonably expect profit. The contract ends when the issuer has fulfilled its promises or failed to.
Impact Theory, 28 August 2023
The studio sold 13,921 Founder’s Keys NFTs for about USD 29.9 million in ETH. The SEC took into account statements about building the next Disney, the promise to spend proceeds on development and a 10% royalty on resales. The order required disgorgement of USD 5.12 million, interest and a USD 500,000 penalty, and removal of the royalty from the smart contract.
Stoner Cats 2, 13 September 2023
10,320 NFTs were sold at 0.35 ETH, about USD 8.2 million. The SEC found them to be investment contracts. The penalty was USD 1 million, which went to a fund for harmed investors.
For a P2E game the danger is not the items themselves but the words around them. Phrases like “earn”, “rising price” and “we are building an ecosystem that will grow” create exactly the expected profit from others’ efforts. We covered the SEC’s proposal for public token sales in our article on Regulation Crypto Assets, and the line between a game and gambling in our article on Play-to-Earn and hidden gambling.
EU: utility token, NFT and financial instrument
The EU asks differently. First it checks whether the token is a financial instrument, and only then applies MiCA.
Definition of a utility token
MiCA, in Article 3, calls a utility token one that is only intended to provide access to a good or service supplied by its issuer. A token for access to a game and its content fits that description.
ESMA guidelines of 19 March 2025
Under the guidelines, tokens that give access to services, premium game content or discounts are generally not transferable securities if they offer no returns comparable to financial instruments and do not form a class. That holds even if buyers hope the price will rise. An expectation of future profit does not by itself make a token a financial instrument.
When a token is still a security
Three criteria are needed together: the token is not an instrument of payment, it belongs to a class of securities, and it is negotiable on the capital market. Its rights must be comparable to shares or bonds, and votes on protocol or technical upgrades do not count as shareholder rights.
NFTs and hybrid tokens
Unique assets such as collectibles are generally outside MiCA, but uniqueness is not determined by a technical identifier alone, and fractionalised NFTs are not automatically unique. If a hybrid token meets the financial instrument criteria, that classification takes precedence, and the label utility has no weight.
In the EU a game token with a clear function and no promise of income has a chance of remaining a utility token. A token sold as a share in the game’s success and giving rights similar to shares is treated by ESMA as a financial instrument whatever its name.
We will review your situation and propose a solution for your project.
Payment instrument and withdrawal into money
A token may or may not be a security, but payment rules still apply if it can be used to pay outside the game or withdrawn into money.
FinCEN and convertible currencies
FinCEN’s 2013 guidance defines convertible virtual currency as one that has an equivalent value in real currency or acts as a substitute for it. An administrator that issues a currency and may redeem it, and an exchanger that exchanges it, can become money transmitters. Closed-loop game currencies are not addressed in that document.
Limited network in the EU
PSD2 (the second EU Payment Services Directive) excludes payments in a limited network, for example inside one shop or game. In our assessment an in-game currency without withdrawal into money may fall under that exclusion, but the regulator must be notified if payments over 12 months exceed EUR 1 million.
A token pegged to money
An e-money token, meaning one pegged to a single official currency, is regulated as a payment instrument under MiCA and PSD2. Inside a game it is better not to issue such a token yourself but to use a licensed provider.
Withdrawal into money
If a player withdraws tokens into money, the exchange is done by a provider, which must be licensed and check its customers. More on this in our article on accepting cryptocurrency in business and our article on the Travel Rule.
How to build tokenomics so it stays an in-game currency
These rules are taken from the decisions above. They do not replace a legal assessment of a specific project.
Do not promise income
Words about payback, price growth and earnings must not be used in advertising and the white paper. Advertising should describe the token’s use in the game.
Separate the tokens
It is better to separate and describe the in-game currency, the governance token and NFTs individually, rather than give one token all the roles.
Check withdrawal into money
If withdrawal is possible, determine the provider, licence and customer checks. If not, fix that in the game terms.
Align the documents
The white paper, game terms, marketing and investor contracts must not contradict one another. The SEC looks at all of the issuer’s public statements, and ESMA looks at the token’s real content, not its label.
A studio sells NFT heroes and promises owners a “share of the game’s revenue”. The NFT description says “the more players, the higher your share”. In the US this looks like an investment contract, as in Impact Theory. In the EU such an NFT is more likely to be treated as a financial instrument. If the promise of a share is removed and the hero is left as a game item, the assessment changes.
What to do now
A sequence for a studio before launching a token.
Describe each token’s role
Currency, item, governance, stablecoin. For each, answer what it gives the player and whether it can be withdrawn into money.
Start hereCheck the text for promises
Advertising, white paper, Discord, team posts. Remove promises of income and growth.
Test the token against the criteria
US: investment contract. EU: utility token, NFT or financial instrument.
Decide on withdrawal
Provider, licence, customer checks, country restrictions.
Exclude problem markets
If the token cannot be offered in the US or EU, block access technically and in the terms.
Update the documents
Game terms, token policy, contracts with partners and investors.
If the token is needed for the game, it is closer to an in-game currency. If it is bought for a price rise through the studio’s efforts, it is closer to a security.
Regulators look not at the token’s name but at what the studio promised and what the token gives the player.LegalBit team
Frequently asked questions
Can a game token be a security in the US?
The token itself, no, but an investment contract can form around it if the studio promises efforts from which buyers expect profit. The SEC’s 2026 interpretation says exactly this.
What is a utility token under MiCA?
A token intended only to provide access to a good or service supplied by its issuer (Article 3 of MiCA). For a game it is access to the game and its content.
Do I need a licence if players withdraw tokens into money?
The exchange is done by a provider, which needs a licence. A studio that itself exchanges tokens for money may become a money transmitter in the US or a crypto-asset service provider in the EU.
Is an NFT a security?
In the US it depends on the promises around the NFT, as the Impact Theory and Stoner Cats cases show. In the EU unique NFTs are generally outside MiCA, but if an NFT meets the financial instrument criteria, MiFID II (the Markets in Financial Instruments Directive) applies.
Can I use the word earn in advertising?
It is better to avoid it. In SEC decisions such words together with promises of growth became evidence of expected profit.
What if the token is already on the market?
Assess it against the criteria above, check advertising and documents, fix the promises and, if needed, restrict the offer in the US or EU.
See also: Play-to-Earn or hidden gambling; Regulation Crypto Assets; SAFT and SAFE; NFT marketplace checklist; DeFi and DAO. Services: regulatory and compliance.
- SEC: press release 2026-30 on the application of securities laws to crypto assets (17 March 2026)
- SEC: fact sheet on the interpretation, Release No. 33-11412
- SEC: proposed Regulation Crypto Assets, Release No. 33-11434
- SEC: order in Impact Theory, LLC, Release No. 33-11226 (28 August 2023)
- SEC: order in Stoner Cats 2, LLC (13 September 2023; extension order of 3 November 2023)
- ESMA: guidelines on the criteria for qualifying crypto-assets as financial instruments (19 March 2025)
- ESMA: MiCA, Article 3, definitions
- EUR-Lex: Regulation (EU) 2023/1114 on markets in crypto-assets (MiCA)
- EUR-Lex: Directive (EU) 2015/2366 on payment services (PSD2)
- FinCEN: guidance FIN-2013-G001 on virtual currencies (18 March 2013)
- FinCEN: guidance FIN-2019-G001 on business models involving convertible virtual currency
This topic is our service
More on how we help crypto and gaming projects:
