South Korea’s Financial Services Commission (FSC) has revealed a comprehensive set of guidelines focused on the issuance and trading of tokenized securities, marking a significant step in the nation’s adoption of distributed-ledger technology within its capital markets.
New framework for tokenized assets
The proposed regulatory changes, set to take effect in February 2027, would permit a range of financial instruments—including stocks, bonds, funds, and eligible fractional investment securities—to be issued and circulated in tokenized form. This framework aims to increase efficiency and transparency across the securities market.
The FSC plans for the rules to enter into force on February 4, 2027, coinciding with new amendments that formally recognize distributed ledgers as applicable infrastructure for the circulation of securities in South Korea.
Requirements and limits for market participants
Under the proposal, companies involved in issuing and directly managing customer accounts for tokenized securities will be required to maintain at least 4 billion Korean won ($2.8 million) in equity capital. Firms must also employ dedicated compliance and technology specialists to strengthen operational and cybersecurity standards.
In addition, revisions to existing capital market regulations would establish a new over-the-counter exchange license specific to debt securities. The FSC has proposed a limit of 100 million won ($70,000) in annual net purchases for individual retail investors on each licensed OTC exchange platform.
The regulatory package builds on a three-phase roadmap initially disclosed in early September, laying out a structured shift toward integrating distributed-ledger infrastructure into the issuance and trading of traditional securities.
Public consultation and next steps
A period of public consultation will begin on Friday and conclude on November 11. Following this process, the regulations will proceed through South Korea’s official approval channels before the scheduled implementation date.
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The FSC’s announcement aligns with a broader push by South Korean authorities to modernize the nation’s financial markets while introducing robust investor protections. The move also reflects a growing global trend of integrating blockchain and distributed-ledger technologies into existing securities infrastructure.
