Hanwha taps Avalanche for tokenized securities platform in South Korea

Hanwha Investment & Securities has reportedly completed a tokenized securities platform supporting Avalanche as South Korea prepares to bring blockchain-based securities into its regulated capital markets system in February 2027.

Seoul Economic Daily reported Sunday that the South Korean brokerage began developing the platform with blockchain technology firm FairSquare Lab in 2025. The system was built to operate across multiple networks, including Avalanche and enterprise Ethereum client Hyperledger Besu.

Development has come ahead of amendments to South Korea’s Electronic Securities Act and Capital Markets Act taking effect on Feb. 4, 2027. The changes will legally recognize distributed ledgers as securities registers and allow tokenized securities to operate within the country’s existing capital markets framework.

The Korea Securities Depository is preparing infrastructure capable of connecting with Avalanche, Hyperledger Besu and Hyperledger Fabric, giving securities companies several blockchain options as they build systems for the incoming framework.

Hanwha tokenized securities platform supports Avalanche

Hanwha started work on the platform last year and has since completed development, Seoul Economic Daily reported, citing blockchain industry sources.

FairSquare Lab developed the system with support for more than one distributed ledger. Alongside Avalanche, Hanwha can use Hyperledger Besu, an Ethereum-compatible blockchain designed for enterprise deployments.

Several South Korean financial firms have already used enterprise networks such as Hyperledger Besu for token securities infrastructure. Hanwha’s system extends that approach to Avalanche, where institutions can establish dedicated networks with controls over participation and validators.

The Korea Securities Depository is preparing its own token securities infrastructure to communicate with different blockchain technologies. Its published distributed-ledger requirements cover Avalanche, Hyperledger Besu and Hyperledger Fabric.

Participation in connected distributed ledgers will remain limited to approved institutions, including securities companies and the depository. The KSD would participate directly in the networks to oversee total issuance and electronic registration information.

Demand from financial companies influenced the inclusion of Avalanche, according to Seoul Economic Daily. A KSD official told the publication that several companies had requested support through industry consultations and existing projects.

Avalanche has already been used for regulated tokenized securities infrastructure in Japan. In July, Progmat moved its tokenized securities platform from Corda 5 to a dedicated Avalanche Layer 1, transferring every active security token project managed through its system.

Those projects represented more than 452 billion yen in underlying assets and issued securities at the time of the migration. Progmat said the change made the securities compatible with the Ethereum Virtual Machine while retaining existing institutional controls.

The Japanese platform redesigned its architecture so business functions were no longer tied to a single blockchain, using a separate layer between its applications and underlying ledger. Progmat said the structure would allow other networks to be connected later.

South Korea tokenized securities rules start in February

Hanwha’s platform arrives as South Korea finalizes the operating structure for tokenized securities before the February rollout.

The Financial Services Commission unveiled a three-stage implementation roadmap on Sept. 4, covering the types of securities that can initially be tokenized and how the market could expand after the amended laws take effect.

Crypto.news previously reported that South Korea’s tokenized securities roadmap will initially cover privately pooled money market funds and bonds reserved for institutional investors.

Unlisted shares issued through a trust structure and publicly offered fractional investment securities will qualify during the first stage as well.

The second phase would extend tokenization to all publicly offered securities. Regulators have not set a fixed date for that stage, with implementation depending on the results of the initial rollout and adoption of the required technology among market participants.

Under the final phase, the FSC plans to build onchain payment infrastructure linked to stablecoins, allowing the payment side of tokenized securities transactions to move onto blockchain rails.

Timing for the settlement system will depend partly on pending South Korean stablecoin legislation.

The roadmap follows amendments approved by the National Assembly in January that established a legal basis for distributed ledgers to serve as securities registers. Tokenized instruments will remain securities under existing financial laws instead of being treated as a separate asset class.

Regulators had been preparing the implementation details for months. In May, the FSC outlined its rulemaking schedule while studying how stocks, bonds and money market funds could be incorporated into the system.

The FSC said at the time that South Korea would not move its entire electronic securities market onto blockchain infrastructure at once. Authorities instead planned staged tests covering securities rights, trading, settlement and onchain payments.

Securities firms face infrastructure requirements

Financial companies connecting their distributed ledgers to the Korea Securities Depository will have to pass screening and operating tests under the KSD’s technical guidelines.

Reviews will cover issuance and circulation functions alongside contingency measures for system errors and other disruptions. The FSC has said securities firms must maintain operational stability comparable to the existing electronic securities system while using distributed ledgers.

Existing financial investment companies will not need a separate license solely for handling tokenized securities. Firms can conduct tokenized securities activities falling within their current licensed business areas.

Companies seeking to intermediate tokenized securities transactions on over-the-counter markets will need prior consultation with the Financial Supervisory Service.

Retail investors will face separate limits. The FSC has proposed capping individual subscriptions to non-monetary trust beneficiary certificates at the lower of 30 million won or 5% of the total issuance.

Annual net purchases by retail investors on each OTC exchange will be capped at 100 million won.

South Korea is preparing central market infrastructure at the same time. Samsung SDS has been developing a token securities platform for the Korea Securities Depository designed to connect blockchain records with the country’s existing electronic securities account infrastructure.

The platform is expected to support issuance, circulation checks, rights management and monitoring when the new system begins operating.

Hanwha expands its tokenization investments

Hanwha has spent several years building positions across companies involved in tokenization and blockchain infrastructure.

The conglomerate became Securitize’s largest shareholder after holdings spread across three affiliated entities reached a combined 9.6%, according to U.S. regulatory filings.

As reported in July, entities linked to Hanwha collectively held 15.69 million Securitize shares, putting the group ahead of Blockchain Capital and Securitize co-founder and CEO Carlos Domingo.

A private equity fund managed by Hanwha Asset Management accounted for a 5.9% stake. H Foundation, a Hanwha Systems subsidiary, held 3.1%, while Hanwha Investment & Securities controlled roughly 0.6%.

Hanwha Investment & Securities described its own purchase as a financial investment through a pre-IPO financing round. The brokerage left open the possibility of using the investment in its digital asset and real-world asset tokenization businesses.

Securitize provides tokenized asset infrastructure for financial institutions including BlackRock, Apollo, BNY, Hamilton Lane, KKR and VanEck. Its platform managed more than $4 billion in onchain assets and supported more than 650 tokenized funds earlier this year.

The company went public on the New York Stock Exchange under the ticker SECZ in July and issued blockchain-based versions of its common shares on Solana and Avalanche on the same day. The tokens represent the same NYSE-listed shares instead of a separate security class.

Hanwha Investment & Securities has put money into several other blockchain companies this year, including blockchain research and data company Xangle and Web3 infrastructure provider Kresus.

In July, the brokerage disclosed a 30 billion won, or roughly $22.3 million, investment in Digital Asset, the operator of the institutional-focused Canton Network.

Hanwha Investment & Securities has increased its position in South Korea’s crypto sector as well, investing another 597.8 billion won in Dunamu, the operator of Upbit, and raising its ownership stake to 9.84%.