South Korea integrates token securities into capital market modernization plan
In brief
- FSC launched capital market infrastructure review coordinating reforms across government agencies and market operators
- Token securities framework scheduled for February 2027 after regulators complete subordinate rules
- Samsung SDS won contract to build token securities management platform connecting blockchain to depository systems
- Settlement cycle roadmap expected by October; OTC trading system for unlisted shares due end of 2026
Regulatory roadmap takes shape
The FSC launched a capital market infrastructure review meeting on Tuesday to coordinate the broader initiative. Plans for token securities will be further discussed separately through a public-private council before being linked to the wider effort.
FSC Vice Chairman Kwon Dae-young said the initiative would build on broader efforts to improve the capital market, guided by four policy priorities: trust, shareholder protection, innovation and market access. The modernization includes a roadmap for shortening the securities settlement cycle, expected by October.
Timeline and infrastructure
In January, the National Assembly approved amendments recognizing blockchain-based distributed ledgers as valid securities registries and permitting the issuance and circulation of token securities. The token securities framework is scheduled to take effect in February 2027 after regulators complete subordinate rules and supporting infrastructure.
The FSC is targeting July for the release of proposed subordinate regulations and guidelines. A Korea Securities Depository system for settling over-the-counter trades in unlisted shares and fractional investment products is scheduled to launch by the end of 2026.
Platform development
Samsung SDS won a Korea Securities Depository contract to build a token securities management platform that connects the depository's existing electronic securities account system to blockchain-based data. The company aims to complete the platform by February 2027, when the new framework is scheduled to take effect.
This integration places tokenized securities within South Korea's broader effort to modernize traditional financial markets, potentially enabling faster settlement and broader retail access to fractional ownership instruments.
