South Korea's FSC proposes tokenized securities rules ahead of February 2027 start
In brief
- FSC proposal would let stocks, bonds and funds be issued in tokenized form, per Cointelegraph.
- Issuers managing customer accounts would need at least 4 billion won (about $2.8 million) in equity.
- Retail investors would face a 100 million won annual net purchase cap per OTC exchange.
- Public consultation runs to Nov. 11; rules are slated to take effect Feb. 4, 2027.
What the FSC proposed
The proposal, as reported by Cointelegraph, sets out requirements for companies that issue and manage tokenized securities. LeoDex News hasn't seen the FSC document itself, so every detail below comes from that report.
Capital comes first. Under the proposed changes, companies issuing tokenized securities while directly managing customer accounts would need at least 4 billion Korean won in equity capital (roughly $2.8 million, using Cointelegraph's conversion). They'd also need dedicated compliance and technology staff on top of that capital.
None of these figures are final yet.
A new OTC license and a retail cap
Separate revisions to Korea's capital markets regulations would create an additional over-the-counter exchange license for debt securities, according to Cointelegraph. Those same revisions would cap retail investors at 100 million won in annual net purchases on each OTC exchange, which the outlet put at about $70,000.
So there are two layers here. One governs who can issue and hold customer accounts, and the other governs where debt securities trade and how much retail buyers can put in on each venue.
The road to February 2027
The rules build on a three-phase roadmap unveiled on Sept. 4 for moving securities issuance and trading onto distributed-ledger infrastructure. Public consultation runs until Nov. 11, and an approval process starts after that, per Cointelegraph's report.
If the package clears approval, it's scheduled to take effect on Feb. 4, 2027, alongside amendments recognizing distributed ledgers as infrastructure for issuing and circulating securities. For anyone building on the blockchain side, that last piece is the notable one: it's the amendment that formally puts the ledger inside the securities framework.
The capital floor, the OTC license and the retail cap are all still open for comment, and the numbers that come out of approval won't necessarily match the ones on the table today.
Frequently asked questions
When would South Korea's tokenized securities rules take effect?
According to Cointelegraph, the proposed regulations are scheduled to take effect on Feb. 4, 2027. That's alongside amendments recognizing distributed ledgers as infrastructure for issuing and circulating securities. Before then, the rules go through public consultation until Nov. 11 and then an approval process.
How much capital would tokenized securities issuers need in South Korea?
Under the FSC proposal as reported by Cointelegraph, companies issuing tokenized securities while directly managing customer accounts would need at least 4 billion Korean won (roughly $2.8 million) in equity capital. They would also need dedicated compliance and technology staff.
What limit would retail investors face on South Korean OTC exchanges?
Separate capital markets revisions would create an additional OTC exchange license for debt securities. Cointelegraph reported that they would cap retail investors at 100 million won (about $70,000) in annual net purchases on each OTC exchange. The cap is part of a proposal and isn't final.
