a STO has to go through regulations exactly as a IPO does, a STO has to be traded on a ATS or through a broker thus not being allowed to freely transact in a currency like manner thus not making it a cryptocurrency.
I don't think because those who conduct STO have to go through a verification process before operation make their coin less of cryptocurrency, STO companies issues security tokens to its investors which is still a part of a cryptocurrency. I think STO is better than ICO because it is regulated, this would prevent scam that we always see by many ICO projects because we don't have anybody regulating ICO projects, STOs gives investors more confidence.
STOs are not completely crypto but also operate on blockchain Technology which is the main purpose of crypto currency, the most important thing here is the crypto currency irrespective of the vessel its using, ICO is just a vessel that has been corrupted by peoples greed.
At least STO's own form of investment is quite secured and protect investors other than the ICOs that are just coming up to scam and the ones that are not scams end up failing without returning money back to investors since there are no regulations or anyone to hold them responsible.