[Weekend Money] Stocks, Bonds, and Funds to Be Tokenized... The Key Issue Going Forward Is

Securities Firms Expected to Benefit from Handling Security Tokens
Short-Term Profitability in Question... Need to Ensure Infrastructure Stability

As the scope of security token (STO) adoption is expanded to include stocks, bonds, and funds, the transition of related infrastructure is drawing attention. While existing securities firms are expected to benefit in the medium to long term, some analyses suggest that, in the short term, securing experience in building and operating infrastructure should take precedence over profitability.

Artificial Intelligence (AI) Gemini Generated Image

On September 4, the Financial Services Commission announced its policy direction for security tokens, designating the entire existing securities market—including stocks, bonds, and funds—as targets for tokenization, and detailing the infrastructure for issuance and distribution, as well as the phased scope of application. Under these plans, the tokenization of institutional private money market funds (MMFs), private bonds, and unlisted stocks will be pursued by February next year, followed by an expansion to public offering securities and on-chain payments based on stablecoins.

The Financial Services Commission defines security tokens, in terms of issuance methods, as existing securities recorded on distributed ledgers instead of via electronic registration. With this in mind, it is important to determine how many assets in the existing capital market can be transitioned to a tokenized model.

According to Eugene Investment & Securities, the main beneficiaries of this policy direction in the medium to long term will be securities companies. This is because, rather than creating a separate security token license, the company’s securities business operations have been allowed to transition to security token infrastructure, thereby permitting existing securities companies to handle security tokens.

A key point to note is the difference in approaches to tokenization between Korea and the United States. The US is focused on maintaining the rights framework of existing central depository infrastructure while enhancing mobility and collateral utilization through various networks. In contrast, Korea has taken a more conservative approach by incorporating distributed ledgers as legally binding ledgers, thereby exercising strong control over system stability.

If Korea’s current closed structure persists for a long time—especially given the higher difficulty of connecting to external networks—the benefits of tokenization may be confined to issuance and distribution rights management. Therefore, in the future, it will be necessary to secure scalability by enabling connections with other ledgers.

Kim Sehee, a researcher at Eugene Investment & Securities, said, "At the current stage, security tokens offer limited short-term profitability, but the changes are inevitable for future market participation. Rather than aiming for early market dominance, it is more effective to approach this issue by securing operational experience and a choice of infrastructure that will allow immediate expansion in line with the timing of future market growth."

This content was produced with the assistance of AI translation services.