A popular structure for global token raises runs two tranches side by side: Regulation D for US accredited investors and Reg S for non-US investors offshore. Done right, it lets one offering reach both audiences lawfully - US capital under a domestic exemption, international capital under the offshore one.

The catch is keeping the two tranches properly separated so that US-focused marketing does not taint the Reg S side, and non-US buyers are genuinely screened. It is powerful but technical, and firmly a job for counsel.

Why issuers combine them

Reg D alone reaches US accredited investors; Reg S alone reaches non-US investors. Many sponsors want both pools, so they run both exemptions in one coordinated raise rather than two separate ones.

For tokenized assets this is natural: a single token can be sold to US accredited buyers under Reg D and to non-US buyers under Reg S, with the contract enforcing which rules apply to whom.

How the structure works

You create two tranches of the same offering. The US tranche sells to verified accredited investors under Reg D (often 506(c) if you are marketing publicly in the US). The offshore tranche sells to non-US persons under Reg S, with its own compliance period.

Each investor is routed to the correct tranche based on whether they are a US person, and the token enforces the matching restrictions per holder. This is more than a label: the two tranches usually carry different resale clocks - roughly a one-year Rule 144 hold on the Reg D side, and a Reg S distribution-compliance period on the offshore side - so a compliance-aware token has to track lockups per wallet, not one rule for the whole supply. A practical consequence worth coding deliberately: a Reg S holder reselling into a US person during the compliance period can taint the offshore exemption, so the contract typically blocks transfers to US-person wallets until that period has lapsed.

The rules to respect

The main risk is cross-contamination. Reg S requires no "directed selling efforts" at the US market, while Reg D 506(c) lets you market publicly in the US. You must structure marketing so your US campaign does not undermine the offshore status of the Reg S tranche.

You also need rigorous screening: US persons must only enter the Reg D tranche and meet its accreditation rules; non-US persons go to Reg S and observe its compliance period. Mixing them up jeopardizes both exemptions.

Why it needs careful structuring

Because each exemption has its own conditions, combining them multiplies the ways to slip up - a US person in the Reg S tranche, US-directed marketing bleeding into Reg S, or inconsistent resale rules across tranches. Each error can break an exemption.

This is exactly where experienced securities counsel earns their fee. The payoff - one offering, a global investor base - is real, but only if the separation is clean.

Technically, the clean way to run it is one token with partitioned rules: standards like ERC-1400 let the same security carry separate partitions - a Reg D partition and a Reg S partition - each with its own lockup and transfer logic, so the chain itself keeps the tranches from bleeding into each other. The paperwork splits too: each tranche typically has its own subscription documents and disclosures tuned to its exemption, even though they describe the same underlying asset. For the offshore side in depth, see Reg S for issuers.

Where to go next

• Next: RWA smart contracts and tech stack.
• The offshore side: Reg S for issuers.
• Glossary: Regulation S.

Sources: U.S. SEC (sec.gov), as of 2026.