A digital security is essentially a blockchain-based representation of a financial asset (such as stocks, bonds or some other types of monetary collateral) or of a physical asset (such as gold, real estate, or simple fiat money in the bank)

This representation takes the form of a digital token that is coded on a blockchain to ensure that there can be only one copy of each token and that just one individual can own it at any given time. Using blockchain then ensures that fraudulent transactions (i.e., sending the same token to two different people) are near-impossible.

A digital security offering is a way for a company to sell a portion of its digital assets to accredited investors to raise funds, in a similar fashion to selling stocks in an IPO.