South Korea's Ministry of Economy and Finance classifies tokenized stocks as securities rather than virtual assets under existing legislation, a position that could bring the products under the country's existing tax framework if the Financial Services Commission reaches the same legal interpretation. A ministry official stated that although tokenized stocks formally take the form of virtual assets, they are substantially closer to securities, noting that financial regulators previously shared this classification with the ministry on multiple occasions. The Financial Services Commission's 2023 Token Securities Guidelines state that token securities issued in the form of digital assets are subject to the Capital Markets Act, with planned amendments to the guidelines expected in July and potential taxation beginning in the second half of 2026.
Ministry Official Confirms Securities Classification for Tokenized Stocks
Local news outlet Bloomingbit reported on Friday that a ministry official stated the ministry currently classifies tokenized stocks as securities under existing legislation. The official explained that although tokenized stocks formally take the form of virtual assets, they are substantially closer to securities. Financial regulators previously shared this classification with the ministry on multiple occasions.
Tokenized stocks are instruments where actual equities are held in custody by a custodian, and the corresponding economic rights are issued and distributed as digital tokens on a blockchain system, allowing capital gains exposure alongside 24/7 transactions.
FSC Guidelines State Token Securities Subject to Capital Markets Act
The Financial Services Commission's 2023 Token Securities Guidelines state that token securities issued in the form of digital assets are subject to the Capital Markets Act, although the specific legal treatment of tokenized conventional equities has remained unresolved.
If the FSC adopts the same interpretation in planned amendments to its Token Securities Guidelines and subordinate regulations expected in July, taxation could begin as early as the second half of 2026 under the existing Capital Markets Act. According to Bloomingbit, tokenized stocks traded through overseas platforms could also fall within the scope of taxation if their underlying economic rights qualify as securities under existing law.
Tokenized Equities Market Reaches $5.5 Billion Market Cap
The regulatory discussion comes as demand for tokenized equities continues to accelerate globally. According to The Block's data, the tokenized equities market recently reached $5.5 billion in market capitalization, making it the fourth-largest real-world asset category.
FAQ
What did South Korea's Ministry of Economy and Finance say about tokenized stocks?
South Korea's Ministry of Economy and Finance classifies tokenized stocks as securities rather than virtual assets under existing legislation. A ministry official stated that although tokenized stocks formally take the form of virtual assets, they are substantially closer to securities.
When could taxation of tokenized stocks begin in South Korea?
If the Financial Services Commission adopts the same securities classification in planned amendments to its Token Securities Guidelines expected in July, taxation could begin as early as the second half of 2026 under the existing Capital Markets Act.
How large is the global tokenized equities market?
According to The Block's data, the tokenized equities market recently reached $5.5 billion in market capitalization, making it the fourth-largest real-world asset category.
