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ZEC $1,370 South Korea advances tokenized securities rules ahead of 2027 rollout
The Financial Services Commission proposed capital, licensing and retail limits for tokenized securities before rules take effect in February 2027.
Key takeaways
- Start date is 2027. The proposed regulations are scheduled to take effect on Feb. 4, 2027, after the current approval process.
- Capital floor set. Issuer account management entities would need at least KRW4 billion in equity capital, plus compliance and technology staff.
- Retail cap applies. Retail buyers would be limited to KRW100 million in annual net purchases on a single OTC exchange.
What happened
South Korea's Financial Services Commission proposed detailed rules for issuing and trading tokenized securities, with the framework set to take effect in February 2027. The plan was announced on October 1, 2026.
Under the proposal, stocks, bonds, funds and some fractional investment securities could be issued and circulated as tokens.
The draft revises lower-level rules under the Financial Investment Services and Capital Markets Act and the Act on Electronic Registration of Stocks and Bonds.
Companies that issue tokenized securities and manage customer accounts directly would need at least 4 billion Korean won ($2.8 million) in equity capital, plus dedicated compliance and technology staff, including two information technology professionals.
A new over-the-counter exchange license would cover debt securities, and retail buyers would be limited to 100 million won ($70,000) in annual net purchases on each such exchange.
Why it matters
The rules supply the detail needed to apply laws that already allow tokenized securities, starting on February 4, 2027.
Distributed ledgers would need to be shared between the Korea Securities Depository and at least two account management entities, a setup the FSC says is meant to support credibility and continuity. Issuer account management entities can count toward that total.
Fees for using the ledgers would be banned. The regulator said distributed ledgers are public in nature, and charging for their use could disrupt the confirmation of securities rights.
The FSC expects trading of debt securities between retail investors to grow once bonds circulate in tokenized form. The OTC license would sit alongside licensing units for unlisted stocks and non-monetary trust beneficiary certificates.
What the data shows
The equity capital floor for issuer account management entities is KRW4 billion, described elsewhere as 4 billion Korean won ($2.8 million).
The retail limit is KRW100 million, or 100 million won ($70,000), in annual net purchases on a single OTC exchange.
The public comment period runs from October 2 to November 11, 2026. If approved, the new rules take effect on February 4, 2027, the same day the revised laws begin to apply.
Background
The proposal follows a three-phase roadmap announced on Sept. 4 that aims to move securities issuance and trading onto distributed-ledger infrastructure.
The FSC said it will keep talking with industry groups and other stakeholders about its tokenization policy, and will gather opinions and industry needs during the process.
What is still unclear
- The proposals still face an approval process after the public comment period, so the February 2027 start depends on that step.
- One report describes consultation as running from Friday to Nov. 11, while another gives the dates as October 2 to November 11, 2026.
Questions readers ask
When will South Korea's tokenized securities rules take effect?
The proposed regulations are scheduled to take effect on Feb. 4, 2027. They still need to pass an approval process that starts after the public comment period ends.
What capital do tokenized securities issuers need in South Korea?
Companies that issue tokenized securities and manage customer accounts directly would need at least 4 billion Korean won ($2.8 million) in equity capital. They would also need dedicated compliance and technology staff, including one account management professional, one internal control professional and two information technology professionals.
How much can retail investors buy on a South Korean OTC exchange?
Retail investors would be capped at 100 million won ($70,000), or KRW100 million, in annual net purchases on each over-the-counter exchange. The cap applies per exchange under the proposed rules.
Which assets could be tokenized under the plan?
Stocks, bonds and funds would be covered, along with fractional investment products. These include non-monetary trust beneficiary certificates and investment contract securities.
