South Korea to tax tokenized stocks as securities

South Korea will classify tokenized stocks as securities, enabling immediate taxation under the Capital Markets Act, with implementation possible in the year's second half, pending regulator confirmation.

South Korea's Ministry of Economy and Finance has clarified that tokenized stocks will be classified as securities, not virtual assets. This move allows for immediate taxation under the existing Capital Markets Act, pending confirmation from the Financial Services Commission (FSC). The policy could be enacted as early as the second half of the year. Officials noted that, despite their digital format, tokenized stocks possess economic rights and structures similar to traditional securities. The FSC is expected to issue further guidance and rule revisions in July, which will solidify the legal status of these instruments. Additionally, tax authorities are collaborating with international agencies to monitor cross-border transactions. Overseas trades involving tokenized stocks may also be subject to current securities tax regulations. This shift signals the government's intent to regulate digital asset trading within established financial frameworks, moving away from the previous treatment of tokenized stocks as non-taxable virtual assets.