South Korea to Implement Tokenized Securities in Phased Approach Starting February 2027
- The Financial Services Commission (FSC) will initiate a three-stage plan for tokenized securities beginning in February 2027.
- Step 1 includes institutional private money market funds, private bonds, and unlisted stocks digitized through a trust structure.
- Brokers will connect distributed ledgers to the Korea Securities Depository (KSD) without needing new licenses.
- Step 3 aims for on-chain settlement using stablecoins, enabling near-instant delivery versus payment.
- Shinhan Asset Management is collaborating with several firms to create a KRW tokenized short-term bond fund for offshore institutions.
This roadmap outlines the legal framework and operational steps necessary for integrating tokenized securities into South Korea’s capital markets, distinct from its crypto tax regime. The FSC plans to publish subordinate rules by September 2026.
With Step One launching in February, this initiative marks a significant shift towards regulated digital assets under capital markets law, avoiding the impending crypto tax of January at a rate of up to 22%.
