Hana Bank Teams Up with Content Distributor Danal Ent to Establish Security Token Ecosystem

South Korea is expected to lift its prohibition on initial coin offerings (ICOs), permitting companies to raise funds through digital token sales for the first time since 2017. The move would mark a reversal of the country’s strict regulatory stance, which was originally implemented to curb speculation and protect investors. Regulators had imposed the blanket ban citing a proliferation of projects with unclear fundamentals, fraud, and a lack of safeguards. Authorities at the time noted that unlike initial public offerings (IPOs)—which price shares based on corporate earnings and growth potential—ICOs lacked established standards for valuing the tokens themselves, making them difficult to assess.Photo by micheile henderson on UnsplashICO limited to qualified issuersAccording to a report by Newsis, the government is preparing to allow token issuance but will restrict eligibility to corporations that meet specific thresholds. Issuers would be required to submit documentation, including white papers, to financial authorities in advance and ensure these materials are available to investors. These requirements are expected to be codified in the Digital Asset Basic Act, a second-phase crypto bill currently under preparation. The report noted that the legislation aims to protect users and mitigate market risks by clearly defining accountability for potential failures. An official from the financial regulator stated that detailed criteria, such as minimum capital requirements, would be outlined in enforcement decrees after the bill is passed. Under the proposed rules, companies would be required to file a disclosure document with financial regulators. The requirement would mirror securities filings, but with a focus on public disclosure rather than regulatory approval. The Financial Services Commission would receive the filings, while the Financial Supervisory Service would examine them. Officials are also discussing measures to hold issuing companies fully liable should problems arise after issuance, reflecting the practical challenges involved in verifying the technical aspects of token projects in advance. The regulatory shift would allow South Korean companies to issue tokens at home instead of routing offerings through jurisdictions such as Singapore or Hong Kong. Until now, Korea-based issuers have typically set up overseas entities to conduct ICOs before seeking listings on domestic exchanges. The change is expected to encourage projects that previously went offshore to return to Korea. An industry official said the return of domestic token issuance would help tech companies raise early-stage funding at home and support the launch of new businesses. The move would also intensify competition among exchanges to attract promising projects, the official said, potentially broadening product offerings and lifting trading volumes. Japan plans ETFs, industry seeks faster rolloutAs South Korea moves to allow token issuance, Japan is also easing digital asset rules, though the industry has flagged the slow pace of change. According to local media reports, Japan’s Financial Services Agency plans to revise rules governing investment trusts to allow the inclusion of digital assets. This change would pave the way for exchange-traded funds (ETFs) tracking spot crypto prices as early as 2028. Asset managers are already preparing for the shift. A Nikkei survey showed that as of last November, major firms, including Nomura Asset Management, SBI Global Asset Management, Daiwa, Asset Management One, Amova, and Mitsubishi UFJ, were considering the development of crypto-related investment trusts. However, the timeline has faced pushback. Tomoya Asakura, chief executive of SBI Global Asset Management, said on X that allowing crypto ETFs only from 2028 would be too slow for a country aiming to position itself as a global asset-management hub. He called for a faster rollout, arguing that such products could help channel household savings into investment. 

The South Korean financial authority will establish new policies and guidelines for token listing and provide admirable examples from past listing events for local exchanges to follow, according to local media outlet News1.  So far, fiat-to-crypto exchanges in Korea have been listing tokens on their platforms under a guideline issued by Digital Asset eXchange Alliance (DAXA) – a self-regulatory consultation group comprised of five major Korean crypto exchanges. The existing DAXA guideline outlines basic yet vague instructions, which have allowed exchanges to list tokens largely at their discretion.  However, the new guideline from the financial authority, expected to be released by this June, will mark the government’s first official manual on token listing. This is in line with the upcoming Virtual Asset User Protection Act, which will be effective in July. Photo by Hitesh Choudhary on UnsplashSetting clear guidelines for token listingsThe new guidelines are expected to include examples of past fraud detection and real-time monitoring cases which are deemed to have set precedents for the industry players. Moreover, the financial authority plans to distribute past exemplary cases of token listing as early as April, which is anticipated to set a model listing process and help local crypto exchanges adhere to the law and requirements.  This announcement comes after the local game company Wemade relisted its native token WEMIX on Korbit, one of DAXA's member exchanges, just a year after it was delisted on major exchanges due to its deviant practices in token issuance. The relisting of WEMIX has since raised concerns among crypto insiders about the lack of criteria regarding token listings. More refined token listing process As the crypto market's bullish trend continues, Bithumb and Coinone – the second and third-largest exchanges in Korea – are stepping up their efforts to speed up the listing of new coins. Industry experts expect these exchanges will double down on their efforts in screening and reviewing processes for tokens to align with the new guidelines in the future.  An official from the Korean Financial Intelligence Unit (FIU) said that while the anticipated listing process is not legally binding, it will definitely have a more profound impact on local crypto exchanges compared to the self-regulated DAXA guidelines.  

Buysell Standards and AGST collaborate to expand security token projects in Southeast AsiaBuysell Standards, a South Korean company operating fractional investment platform Piece, is accelerating its expansion into the Southeast Asian market through a recent business collaboration.A report from Korean news outlet Financial News indicates that the company has signed a memorandum of understanding (MOU) with AGST, a subsidiary of blockchain-focused investor Fundiant Holdings. This collaboration aims to launch security token projects within the Association of Southeast Asian Nations (ASEAN) region.Photo by Kelvin Zyteng on UnsplashSingapore in Q1 2024As an asset manager in Singapore and Japan, AGST is set to play a pivotal role in the issuance and distribution of security tokens in these markets. Their strategy includes launching security token products in Singapore in the first quarter of next year. These products will be backed by assets from Buysell Standards.The partnership between Buysell Standards and AGST is set to be multifaceted, encompassing several key areas of collaboration. Together, they will focus on developing new investment products and building the necessary infrastructure to support them. They will also focus on marketing and promotional efforts in the ASEAN region.Anticipating regulatory exemptionBuysell Standards is among the seven companies that received approval from the South Korean Financial Services Commission to issue security tokens. The company is anticipating a regulatory exemption from the government, which would allow them to introduce fractional investment products linked to ship finance.Buysell Standards expects that its partnership with AGST will facilitate quicker access to funding from international sources for high-quality investment products in South Korea. Meanwhile, AGST seeks to introduce a range of Korean assets to the global security token market.Emphasizing the quick adoption of fintech by ASEAN investors and their fondness for South Korea, Shin Beom-jun, CEO of Buysell Standard, stated that the company is committed to actively promoting Korean security token products on the global investment stage.Kim Chang-soo, Chairman of Fundiant Holdings, expressed his ambition to strengthen the Korean security token market. He observed that the market is currently in an early stage of development, leading to the undervaluation of underlying assets. He believes that introducing Korean security tokens to international markets will reciprocally aid in the expansion and maturation of the domestic market.