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How Does a Token Being Listed on an Unregulated Exchange Impact Its Legal Standing?

Listing on an unregulated exchange does not change a token's security status but increases legal risk for all parties.
Greeks.Live16.11.25

How Does a Token Being Listed on an Unregulated Exchange Impact Its Legal Standing?

Listing a token on an unregulated exchange does not change its underlying legal classification. If a token is legally a security, trading it on an unregulated platform can expose both the exchange and the issuer to legal risk from regulators like the SEC.

Unregulated exchanges may offer higher liquidity but lack investor protection mechanisms and can be shut down, creating market instability.

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