loans, government bonds, money market funds (MMFs), and alternative investments are

recorded on distributed ledgers and structured as investable products-has been

expanding rapidly in major economies including the United States. The global market

stood at USD 50.37 billion as of end-March 2026, exhibiting accelerating growth (65% in

2023 → 93% in 2024 → 169% in 2025), driven primarily by increased institutional

investor participation. In Korea, the market remains at an early stage, with distributed

ledger technology being applied to fractional investment in non-standardized assets such

as real estate and music copyrights through regulatory sandboxes. However, with the

amendments to the Electronic Securities Act (Act on Electronic Registration of Stocks,

Bonds, etc.) and the Capital Markets Act (Financial Investment Services and Capital

Markets Act) in February 2026, an institutional framework for the issuance and

distribution of tokenized securities has been established.

2. Tokenization has the potential to enhance efficiency, flexibility, accessibility, and

transparency by improving the issuance, distribution, and settlement of assets. By

integrating the entire transaction lifecycle on a distributed ledger, it can shorten

settlement cycles, reduce intermediation and administrative costs, and enable a trading

environment free from temporal and geographical constraints. Furthermore, atomic

settlement via smart contracts can mitigate counterparty risk, fractionalization of

high-value assets can broaden investment accessibility, and real-time sharing of

transaction records can enhance operational transparency. This is assessed not merely as

a technological change but as an innovation that could transform the capital market

paradigm through the digital transformation of securities.

3. Meanwhile, asset tokenization carries potential risks to financial stability. Liquidity

mismatches between tokenized securities and underlying assets, leverage amplification

through rehypothecation, operational, technological, and legal vulnerabilities, as well as

concentration in a small number of platforms and market fragmentation, could all serve

as factors amplifying financial stability risks. While the current global tokenization market

remains minimal in size relative to traditional financial markets, the rapid pace of growth

warrants vigilance regarding the potential accumulation of vulnerabilities in the financial

system.

4. For the successful early adoption of Korea's asset tokenization market, it is essential to

first secure sufficient liquidity so that tokenized securities centered on non-standardized

assets-where market demand has been confirmed-can be actively traded. Additionally,

core infrastructure for asset valuation, custody, disclosure, and other functions must be

systematically built to enhance investor confidence. For traditional financial assets, a

phased expansion roadmap tailored to asset-specific characteristics should be developed,

along with measures to address fragmentation across platforms. From a macroprudential

perspective, a risk management framework should be established, incorporating

monitoring that combines on-chain data with off-chain information, stress tests reflecting

the structural characteristics of tokenization, and cooperation among the Bank of Korea,

financial supervisory authorities, and relevant agencies. Lastly, for settlement of tokenized

assets, priority should be given to central bank money (including central bank digital

currency) and commercial bank deposits (including tokenized deposits), with stablecoins

being utilized in a supplementary capacity, in order to maintain the singleness of money.