Holder communication procedure: what the decision maker looks at
Holder communication procedure describes how a token issuer informs and consults holders before a material event — a change to redemption terms, a technical incident, or a wind-down step. The decision maker reviewing the file checks who was told, when, through which channel, and what evidence proves the message reached its audience.
When this procedure applies
The procedure applies whenever an issuer must reach holders directly, rather than rely on a public announcement alone. Typical triggers include a redemption window opening, a change to the token's terms, a security incident affecting balances, or a step towards winding a token down.
Missing the window has practical costs. A redemption process can stall if holders were not told in time to act. A later dispute usually turns on whether the file shows adequate notice, not on the good faith of the team that sent it.
There is a point of no return in most versions of this procedure. Once the trigger event goes ahead — the window opens, the change takes effect — a gap in the notification record can no longer be closed. It can only be explained.
Stages, documents and timing
The procedure runs in five stages. Each stage produces a document that later proves what happened and when.
| Stage | Typical document | Who acts | Typical timing |
|---|---|---|---|
| Preparation | Holder list extract, draft message | Operations lead | Before the trigger event |
| Sign-off | Approved message, distribution list | Compliance or counsel | Same day as preparation |
| Notification | Sent message, delivery log | Operations lead | On the trigger date |
| Response window | Response log, escalation note | Operations lead, compliance | Set by the issuer's own terms |
| Closure | Closure memo, filed record | Compliance or counsel | After the response window ends |
A file missing any one of these five documents reads as incomplete to whoever reviews it later, whether that reviewer sits inside the issuer or outside it.
What to do first
- Pull the current holder list from the register the issuer actually uses, not an old export.
- Draft the message and route it to compliance or counsel for sign-off before it goes out.
- Send through the channel named in the token's own terms, and log the send with a timestamp.
- Track responses against the holder list, and flag every non-response by name.
- Escalate to counsel once non-responses reach a share the issuer treats as material.
- File the complete record — draft, sign-off, send log, and response log — in one place.
Who decides, and who signs off
Inside the issuer, the compliance function or the board decides whether a message is ready to send. If a dispute follows, an external forum — a court, an arbitrator, or a supervisor — reviews the same file, not a fresh account of it. Who signs the work sets out how sign-off is organised on our side when we run this procedure with a client.
The reviewer rarely asks whether the message was well written. The reviewer asks whether the right holders received it, on time, through a channel they had actually agreed to.
If your situation differs
If the token is redeemable on demand, notification must go out before the redemption window opens, not alongside it.
If a holder cannot be reached through the registered channel, use the fallback channel named in the token's own terms, and log the attempt separately from a normal send.
If holders are spread across several registers or jurisdictions, treat each register as its own notification run, with its own list, its own log, and its own closure memo.
What this page does not cover
This page does not set a fixed number of days for the response window — that figure comes from the token's own terms, not from a general rule. It does not cover pricing for running this procedure, and it does not replace a review of the specific register or jurisdiction involved in a given file.
Sources and limits
This procedure sits next to three questions that tend to surface in the same file. Before extending credit to a counterparty tied to the same token, our Counterparty report before extending credit sets out who decides and when.
Where a message or a sign-off later needs to hold up in a dispute, our Document report before relying on it in a dispute covers what to check first.
Where the holder register itself sits in an unfamiliar jurisdiction, our Jurisdiction report when a register is unfamiliar walks through the first checks.
This page was last reviewed in November 2025. It draws on the firm's own procedure files for token issuance matters and on points raised directly by decision-makers in past communication rounds, not on a single named source.
Related reading
Redemption process design step by step covers the process that usually follows a holder communication round, once the response window closes.
Frequently asked questions
How long does holder communication procedure take in practice?
Preparation and sign-off usually take a day or two. The response window is set by the token's own terms, and closure follows once that window ends and the record is filed.
Which documents are needed to start?
A current holder list, a draft message, and a named channel for sending it. Sign-off evidence and a send log follow once the message actually goes out.
What happens if the other side does not respond?
The non-response is logged against the holder list, not simply ignored. Once non-responses reach a share the issuer treats as material, the file moves to counsel for a view on next steps.
Next step
If an authorisation tied to the same token is at risk, read When an authorisation is withdrawn in practice before running this procedure any further.