The Financial Services Commission (FSC) of South Korea has proposed rules for tokenized securities: a minimum issuer capital of 4 billion won ($2.8 million), a separate license for OTC trading of debt instruments, and an annual retail investor purchase limit of 100 million won ($70,000) per OTC platform. The rules are set to take effect on February 4, 2027.

The changes will allow shares, bonds, funds, and certain types of fractional investment instruments to be issued and traded in tokenized form.

OTC License for Debt and 100 Million Won Annual Limit

The amendments to capital market rules introduce an additional license for over-the-counter platforms trading debt securities. For retail investors, a cap of 100 million won in net annual purchases is proposed for each such platform.

Capital and Staffing Requirements for Issuers

Companies issuing tokenized securities and directly managing client accounts must have at least 4 billion won in equity capital, as well as dedicated compliance and technology teams.

Roadmap and Public Consultation

The proposal is based on a three-stage plan, presented on September 4, to shift the issuance and trading of securities to distributed ledger infrastructure. The draft will undergo public consultation from Friday through November 11, after which the approval process will begin. Starting February 4, 2027, distributed ledgers will be recognized as infrastructure for the issuance and trading of securities alongside the regulatory amendments.