From New Types of Securities to Tokenized Securities: Koscom Moves to Build Capital Market Infrastructure

[Financial News] Koscom is moving ahead proactively to reorganize infrastructure for securities issuance, distribution, and settlement in line with the institutionalization of new types of securities and tokenized securities.
Koscom said on the 27th that the KDX consortium, which it joined with the Korea Exchange and which has received preliminary approval to operate an over-the-counter trading platform for fractional investment, is building a distribution platform with the goal of opening the market by year-end.
KDX recently applied for final approval. The license category it applied for is brokerage for over-the-counter trading of beneficiary certificates. The key goal is to separate issuance and distribution of fractional investment products so that products from multiple issuers can be traded in a single market.
The Korea Exchange is also pushing to launch a market for new types of securities, with a target opening date of November 16, allowing fractional investment in a range of underlying assets such as artworks and real estate. Securities listed in this market will be new types of securities issued and registered under the existing electronic securities system, not tokenized securities based on distributed ledger technology.
Koscom is also preparing KoSTO, a joint tokenized securities issuance platform that can be used by securities firms, in anticipation of the revised Act on Electronic Registration of Stocks and Bonds and the Financial Investment Services and Capital Markets Act taking effect in February next year. The plan is to reduce the burden of building individual systems and avoid duplicate investment, while providing a standardized framework for issuance, ledger management, and institutional linkage from the early stages of the market. To stably connect institutions participating in the tokenized securities ecosystem, Koscom is focusing on linking with KSD's total volume management system, securities firms' ledger systems, and distribution and settlement infrastructure.
"KoSTO" will initially be built as a private distributed ledger structure in line with regulatory guidelines. In the long term, it will be upgraded into an interoperable structure that can connect with public blockchain networks and global digital asset infrastructure, within the scope allowed by relevant laws and security requirements. Koscom is also preparing on-chain DvP, which would allow tokenized securities and settlement assets to be transferred simultaneously on a single network.
Koscom also plans to verify the tokenization potential of conventional securities such as bonds and money market funds (MMFs). The tokenized securities system is starting with fractional investment and new types of securities, but conventional securities are drawing attention for their potential use because financial institutions and investors can access them relatively easily.
Kim Wansung, head of Koscom's digital asset division, said, "We will stably connect market participants around KDX and KoSTO, and prepare step by step for tokenization of conventional securities, on-chain settlement, and linkage with global networks." He added, "Through this, we will lay the foundation for South Korea's capital market to respond proactively to the global shift toward tokenization."

[email protected] Seo Min-ji Reporter