Legal Definitions - dematerialized security

Dematerialized security is a type of security that does not have a physical certificate. Instead, ownership is recorded electronically.

For example, if you own stocks in a company, you used to receive a paper certificate that proved your ownership. But now, most stocks are held in dematerialized form, meaning that the ownership is recorded electronically in a database.

This type of security is also known as an uncertificated security. It is becoming more common because it is more efficient and cost-effective than using physical certificates.

Dematerialized securities are a way for investors to own assets without having to physically hold them. This makes it easier to buy and sell securities, and it reduces the risk of loss or theft of physical certificates.