South Korea’s National Assembly approved amendments legalizing tokenized securities during a plenary session this week in Seoul. The vote updates the Capital Markets Act and the Electronic Securities Act. Lawmakers acted to integrate blockchain-based securities into regulated markets, clarifying issuance, trading, and oversight under existing financial rules.
New Legal Framework and Regulatory Oversight
Under the amended laws, tokenized securities qualify as legal financial products. These include digital representations of stocks, bonds, funds, and investment contracts. The framework places issuance, trading, and custody under supervision by the Financial Services Commission and the Financial Supervisory Service.
Notably, intermediaries must register and obtain licenses before operating. Issuers must meet standardized disclosure requirements. Regulators also set investor protection measures to address fraud, manipulation, and conflicts of interest.
The revised Electronic Securities Act allows qualified issuers to create ledger-based securities. Meanwhile, the Capital Markets Act permits trading through licensed brokerages. According to the FSC, the structure supports smart contract use while maintaining compatibility with existing clearing systems.
The bills now move to the State Council and presidential promulgation. Authorities set January 2027 as the effective date after a one-year preparation period.
Broader Asset Coverage and Market Scope
The new framework expands access to non-standard investment contract securities. These include real estate projects, fine art, and livestock-linked assets. Previously, regulatory constraints limited distribution of such products.
However, the law keeps strict custody and disclosure standards. Regulators aim to ensure transparency across issuance, settlement, and recordkeeping. The structure allows equity and debt instruments to adopt tokenized formats within existing capital market rules.
Boston Consulting Group estimates South Korea’s tokenized securities market could reach 367 trillion won, or $249 billion, by 2030. Separately, Standard Chartered projected tokenized real-world assets globally could reach $2 trillion by 2028.
Implementation and Industry Coordination
The FSC will lead implementation alongside supervisory agencies and industry participants. A consultation body will coordinate ledger-based account systems and custody standards. Authorities scheduled an initial coordination meeting for next month.
Regulatory groundwork began earlier with FSC guidance issued in 2023. Since then, officials have worked to connect blockchain infrastructure with traditional finance. Firms such as Mirae Asset Securities and Hana Financial Group have announced platform preparations.
Meanwhile, South Korea continues drafting the Digital Asset Basic Act. Officials position tokenized securities as regulated extensions of existing capital markets rather than standalone crypto products.