South Korea Issues Guidance on Security Tokens and STOs

• South Korea’s Financial Services Commission (FSC) issued guidance on the regulation of security tokens and their issuance on Feb. 6.
• Certain digital assets that fit the characteristics of securities as defined in the Capital Markets Act, will be regulated as securities in the country.
• The FSC will also permit Security Token Offerings (STOs) by making amendments to its Electronic Securities Act.

South Korea Issues Guidance On Security Tokens and STOs

South Korea’s Financial Services Commission (FSC) has released guidance on regulating security tokens and their offerings (STOs). According to the regulator, digital assets that meet the criteria of securities under the Capital Markets Act will be treated as such and subject to public disclosure requirements. The FSC also plans to amend its Electronic Securities Act to allow for STOs.

Digital Assets Regulated Under Capital Markets Act

Under South Korea’s regulations, cryptocurrencies which offer a stake in business operations or give holders rights to dividends, residual assets, or profits are considered securities. These digital assets must adhere to public disclosure requirements and prohibition on unfair trade practices for investor protection purposes.

Cryptocurrencies Not Regarded As Securities

The FSC clarified that cryptocurrencies without an issuer, such as Bitcoin (BTC) and Ethereum (ETH), would not be treated as securities under South Korean law. These digital assets will instead come under the jurisdiction of a new Framework Act on Digital Assets when it is passed into law.

Security Token Offerings Permitted

The FSC has stated that token issuers can carry out STOs within South Korean borders with appropriate regulatory oversight in place. This includes exchanges having an obligation to assess which cryptocurrencies are classified as securities on a case-by-case basis before trading them on their platforms.


Overall, this new guidance from South Korea provides clarity for investors looking to invest in security tokens via STOs within the country’s borders. By setting out clear rules around what constitutes a security token, it should help foster innovation while providing necessary investor protections from fraudulent activities or schemes.

Dieser Beitrag wurde am von unter Allgemein veröffentlicht.