South Korea Pushes Forward with Tokenized Securities Framework

South Korea is taking steps to integrate tokenized securities into its regulated financial markets. The Financial Services Commission (FSC) has proposed new rules for securities issued and traded using distributed ledger technology, which could allow stocks, bonds, and funds to trade on distributed ledgers by February 2027.

The FSC announced the proposed revisions on October 1, 2026, covering regulations under the Financial Investment Services and Capital Markets Act and the Electronic Registration Act. The rules would cover tokenized securities, including stocks, bonds, and funds, as well as certain fractional investment securities.

The proposed framework requires issuers managing accounts to hold at least 4 billion won (~$2.9 million at current prices) in equity capital, raising entry costs for tokenization providers. Retail investors would face a 100 million won annual purchase cap on OTC tokenized bonds, limiting market exposure.