South Korea Plans Stablecoin-Based Tokenization by 2027

South Korea’s Financial Services Commission unveiled a phased roadmap on September 4 for changing shares, bonds and funding funds into blockchain-based tokens, with the earliest section as a result of begin in February 2027 as soon as an modification to the Electronic Registration Act takes impact.

The plan hyperlinks the nation’s securities market to a stablecoin cost system that regulators need constructed by the time the rollout reaches its last stage.

Seoul Lays Out a Three-Step Timeline

The FSC’s roadmap, offered throughout the third private-public consultative assembly on securities tokenization, breaks the transition into three levels.

Phase one begins in February 2027 and covers privately pooled cash market funds and bonds reserved for institutional traders, unlisted shares held by belief constructions, and publicly supplied fractional funding securities.

Phase two widens the pool to each sort of publicly supplied safety. But the third section is the extra formidable one: an on-chain funds system tied to stablecoins, although the FSC says the tempo of phases two and three depends upon how the primary rollout goes, how briskly the market adapts, and the place pending stablecoin laws finally ends up.

The fee additionally revealed mannequin requirements for fractional funding, capping particular person subscriptions at whichever is smaller between 30 million gained ($22,200) and 5% of an issuance, and requiring issuers to order a minimal retail allocation.

Trading tokenized securities over-the-counter gained’t want a separate license, although corporations should seek the advice of the Financial Supervisory Service first, and retail traders face an annual cap of 100 million gained ($74,000) in web purchases per trade.

Entities that handle tokenized securities accounts will want at the least 4 billion gained, which is about $2.9 million, in fairness and devoted workers for account administration, inner management, and IT safety, whereas the Korea Securities Depository is finalizing the technical checks that securities corporations should move earlier than connecting to the shared ledger.

Revised guidelines below the FSCMA and the Electronic Registration Act are due by the tip of September.

The Risk Other Regulators Have Already Flagged

As CryptoPotato reported beforehand, the IMF warned in an April observe that tokenization strips out the settlement delays banks depend on to handle liquidity, delays that additionally give regulators time to step in earlier than a disaster hardens.

The fund pointed to liquidity stress, skinny oversight of good contracts, and the problem of policing property that cross borders as the principle dangers, arguing that public infrastructure similar to central financial institution digital forex (CBDC) is what retains tokenized markets from making instability worse.

South Korea has additionally moved shortly in opposition to platforms it views as skirting its guidelines, with authorities blocking home entry to Polymarket in August over issues that the platform quantities to unlicensed playing, becoming a member of a rising listing of nations which have restricted it since final yr.

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