South Korea’s Financial Services Commission (FSC) has approved the issuance of securities token offerings (STO) blockchain-powered digital tokens, crypto media outlet CoinDesk Korea reported on January 19.

Although STOs were previously illegal, according to FSC Chair Kim Joo-Hyun, a distribution network is now being established. Since there is an increasing demand for tokenized digital assets domestically and internationally, it now permits brokerage firms in Korea to enter the securities token market. This action is anticipated to increase local market accessibility and liquidity.

It is fair to presume that the Korean government has carried out the necessary checks and balances mechanism now that the official Security Token Offerings are publicly available. The Korean government aspires to take the lead in the current digital revolution. The FSC chairman explains how the financial organization would eventually institutionalize these online trading environments to enable the secure trading of token securities. This strategy's particulars will be made public as early as February.

Meanwhile, since security tokens are treated as financial products under the Capital Markets Act, a new regulatory entity, they cannot be traded on cryptocurrency exchanges other than financial investment companies. Therefore, if the token is listed on the cryptocurrency exchange, it can be traded after ending transaction support (delisting) and going through the listing process in the digital stock market.

Source(KOR): COINDESK KOREA