Korea's FSC Maps Three-Phase Rollout for Tokenised Securities From 2027
Key points
- South Korea's FSC has published a phased tokenisation roadmap tied to legislation passed in early 2026 that recognises distributed-ledger-recorded securities.
- Phase one begins when that law comes into force in February 2027, giving operators a concrete but still-future start date.
- Tokenised money market funds and bonds in phase one are restricted to institutional investors only; unlisted stocks via trust structures and fractional investments are available to both institutional and retail participants.
- Fractional investments will initially be issued as non-monetary trust beneficiary certificates, with investment contracts as a second supported format.
- Phases two and three, covering public securities and stablecoin settlement respectively, carry no fixed timeline, with the FSC linking progression to adoption pace and the outcome of separate stablecoin legislation.
South Korea’s Financial Services Commission (FSC) has set out a phased framework for tokenised securities and fractional investments, anchored to legislation passed earlier this year that formally recognises securities recorded on distributed ledgers. The first phase cannot begin before February 2027, when that law comes into force, establishing a firm but still-distant start line for the market.
Phase one draws a clear institutional-retail divide. Tokenised money market funds and bonds will initially be restricted to institutional investors, while both audiences gain access to unlisted stocks held via a trust structure and fractional investments. Those fractional products come in two forms, non-monetary trust beneficiary certificates and investment contracts, with trust certificates the format supported at launch. Phase two broadens the scope to public securities. Phase three introduces stablecoin settlement, though the FSC has declined to attach a timeline to either later stage, tying progression to adoption rates and the separate legislative process for stablecoins.
The sequencing reflects a deliberate risk-calibration logic: wholesale-only access to the more liquid instrument classes in phase one limits retail exposure while the infrastructure matures, and the open-ended phasing for stablecoin settlement acknowledges that payment-leg reform depends on a parallel regulatory track that remains unresolved. For institutions eyeing the Korean market, the February 2027 effective date is the operative planning horizon, but the absence of fixed dates for phases two and three means product and distribution strategies beyond that point carry real schedule uncertainty.