South Korea's Financial Services Commission has moved its tokenized-securities roadmap into the rulemaking stage, publishing proposed revisions to subordinate regulations under the Financial Investment Services and Capital Markets Act and the Electronic Registration Act. The proposals provide more detailed rules for tokenized stocks, bonds, funds and fractional investment securities ahead of the framework's planned February 4, 2027 implementation.
The regulatory proposals follow the roadmap presented on September 4 at the third private-public joint consultative body meeting on the tokenization of securities. That roadmap outlined a phased expansion from fractional investment products toward conventional securities and, at a later stage, potential stablecoin-linked on-chain payments.
On October 1, the FSC published the proposed subordinate-rule revisions. The public comment period runs from October 2 through November 11, 2026, after which the proposals are expected to proceed through the remaining approval process before the revised laws take effect on February 4, 2027.
Key Findings
- The FSC has now published the subordinate-rule proposals anticipated in its September tokenized-securities roadmap.
- The proposed rules allow conventional securities including stocks, bonds and funds to be issued and circulated in tokenized form alongside specified fractional investment securities.
- Issuer account management entities would need at least KRW4 billion in equity capital and specified account-management, internal-control and IT personnel.
- A new OTC exchange licensing unit would cover debt securities, while retail investors would face an annual net purchase limit of KRW100 million on each OTC exchange.
- The proposals are open for public comment from October 2 through November 11, 2026, with the framework scheduled to take effect on February 4, 2027 after the remaining approval process.
- Stablecoin-linked on-chain payment infrastructure remains a later-stage objective rather than part of the February 2027 initial implementation.
What Changed?
The September 4 roadmap said the FSC planned to introduce revision proposals for subordinate statutes under the Financial Investment Services and Capital Markets Act and the Electronic Registration Act by the end of September 2026.
That regulatory milestone has now occurred. On October 1, the FSC announced the proposed subordinate-rule revisions needed to implement the tokenized-securities framework scheduled to take effect in February 2027.
The proposals translate several elements of the September roadmap into more detailed regulatory provisions, including the types of securities that can be tokenized, requirements for distributed ledgers, registration requirements for issuer account management entities, OTC exchange licensing and retail-investor trading limits.
This does not mean South Korea's tokenized-securities framework is already operational. The proposals are entering a public comment and approval process before the underlying revised laws are scheduled to take effect on February 4, 2027.
What the Proposed Rules Cover
The proposed rules under the Electronic Registration Act specify which securities can be issued and circulated in tokenized form. The scope includes conventional securities such as stocks, bonds and funds, as well as fractional investment securities structured as non-monetary trust beneficiary certificates and investment contract securities.
The proposals also set requirements for the distributed ledgers used in the system. To support reliability and business continuity, the FSC says a distributed ledger must be shared across at least two account management entities, including issuer account management entities where applicable, alongside the Korea Securities Depository as the electronic registration entity.
The FSC also proposes prohibiting direct fees in return for use of the distributed ledger for electronic registration. The regulator links this requirement to the ledger's role as part of the official securities-record infrastructure and the need to avoid disruption in establishing securities rights.
Who Is Affected?
The framework directly affects securities companies, the Korea Securities Depository, securities issuers, issuer account management entities, OTC exchanges and investors participating in tokenized-securities markets.
One important structural change is the issuer account management entity regime. It allows issuers of tokenized securities that meet the requirements to manage securities accounts for customers rather than reserving that function exclusively for existing financial-company account managers.
Under the proposed subordinate rules, an issuer account management entity would need at least KRW4 billion in equity capital. It would also need at least one account-management professional, one internal-control professional and two information-technology professionals.
OTC Trading and Investor Protection
The proposals under the Financial Investment Services and Capital Markets Act also address secondary-market infrastructure.
The FSC proposes adding a dedicated OTC exchange licensing unit for debt securities alongside existing categories covering unlisted stocks and non-monetary trust beneficiary certificates. The regulator says the change reflects expectations that tokenization could increase retail trading of debt securities.
For retail investors, the proposed investment limit is an annual net purchase amount of KRW100 million on each OTC exchange. Net purchases are calculated as total purchases minus total sales on the relevant exchange.
The limit is intended as an investor-protection measure as tokenization expands the range of securities that can circulate through these markets.
How This Fits the Three-Phase Roadmap
The October rulemaking does not replace the three-phase roadmap announced in September. Instead, it advances the legal and regulatory groundwork for its initial implementation.
The first phase is intended to begin with the revised legal framework taking effect in February 2027. The September roadmap identified privately pooled money market funds and institutional bonds, unlisted stocks through a trust structure and publicly offered fractional investment securities among the initial areas.
A second phase is intended to broaden tokenization to publicly offered securities more generally. A third phase would seek to establish on-chain payment infrastructure linked to stablecoins.
Those later phases remain flexible rather than fixed-date commitments. The FSC has said their implementation will depend on the outcome of the first phase, technological adoption by market participants and the development of stablecoin legislation.
Why It Matters for Crypto
South Korea's approach is relevant to crypto because it incorporates distributed-ledger infrastructure into regulated capital markets rather than creating a separate legal category outside securities regulation.
The policy direction is also aligned with a broader global debate over how tokenized securities should be structured. In January 2026, the U.S. SEC staff published a statement on tokenized securities explaining different models, including issuer-sponsored and third-party-sponsored structures, and noting that tokenized format does not remove securities-law obligations.
For South Korea, the key test will be whether distributed-ledger infrastructure can improve issuance, rights management and market connectivity while preserving the legal certainty, investor protection and operational resilience expected in conventional securities markets.
What Comes Next
The subordinate-rule proposals are now in the formal consultation process rather than being a future policy commitment. The public comment period runs from October 2 through November 11, 2026.
After the comment period, the proposed revisions are expected to proceed through the remaining approval process, including Financial Services Commission deliberation, review by the Ministry of Government Legislation and subsequent government approval procedures.
The revised framework is scheduled to take effect on February 4, 2027. Before then, infrastructure development will continue among the Korea Securities Depository, securities companies and other market participants.
The later roadmap remains separate from this immediate rulemaking process. In particular, stablecoin-linked on-chain payment infrastructure remains a future phase dependent on earlier implementation, market adoption and the development of the relevant stablecoin legislation.
Sources & Methodology
This article is based primarily on the Financial Services Commission's September 4, 2026 tokenized-securities policy roadmap and its October 1, 2026 announcement of proposed revisions to subordinate regulations under the Financial Investment Services and Capital Markets Act and the Electronic Registration Act. The October announcement is used to update regulatory steps that were still described as forthcoming in the original article. The SEC staff statement is used only as comparative regulatory context and not as evidence of South Korean policy.
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