South Korea is laying the regulatory groundwork to bring stocks, bonds, funds, and fractional securities onto blockchain infrastructure. The Financial Services Commission (FSC) has proposed regulations that would allow these securities to be issued and circulated in tokenized form starting February 4, 2027.
The proposed rules entered a public consultation period lasting from October 2 through November 11 before proceeding through the approval process. This development follows legislation passed earlier in the year that formally recognized security tokens as a digital form of securities under South Korea’s electronic-registration framework.
The initial phase of the rollout will focus on specific asset classes, including private money-market funds and bonds for institutional investors, trust-based tokenization of unlisted stocks, and publicly offered fractional-investment securities. Later phases could potentially introduce onchain settlement linked to stablecoins, subject to the results of earlier phases, technological development, and pending stablecoin legislation.
To manage risk as secondary-market trading expands, regulators have established specific guardrails. Distributed ledgers must be shared among at least two account-management entities alongside the Korea Securities Depository. Furthermore, firms permitted to issue tokenized securities and manage customer accounts directly will face a minimum equity-capital requirement of $3 million, or 4 billion KRW, as well as staffing requirements for compliance, account management, and technology.
Retail investors will face an annual net purchase limit of $74,000, or 100 million KRW, per over-the-counter exchange. This measure is designed to contain risk as the framework integrates blockchain technology into regulated capital markets.
