The Korea Securities Depository announced that it has completed a testbed platform to respond to the legislation of security tokens.
Security tokens are electronic securities that enhance stability and convenience by utilizing blockchain technology used in cryptocurrencies. In particular, they are gaining attention as a means of 'fractional investment' that divides assets such as artwork, raw materials, and real estate for equity ownership.
Security tokens are accepted as a form of securities issuance under the Electronic Securities Act. A 'distributed ledger' that prevents forgery is recognized as an electronic registration ledger, where issuance and circulation information is simultaneously recorded in electronic ledgers of multiple institutions.
The Korea Securities Depository plays a role in managing the total amount as an electronic registration institution. It collects transaction information recorded in the distributed ledger to ensure that the total issuance and circulation amounts of security tokens always match, thereby protecting investors.
Previously, the Korea Securities Depository implemented relevant business functions and infrastructure in a testing environment and conducted the 'Security Token Testbed Platform Construction Project' for eight months from October of last year to verify this with market participants.
Additionally, from February of last year, consulting on the functional analysis of the security token system was pursued for about three months to analyze the overall platform construction model in advance.
Especially during the project period, through participant registration for testing targeting securities companies and fractional investment businesses, eight testing institutions were selected, and the platform's functionality was verified through external distributed ledger linkage tests conducted twice.
The security token testbed platform consists of a total amount management system, node management system, and distributed ledger system.
The Korea Securities Depository explained that it has determined the direction of execution methods by directly participating as a node in all distributed ledgers of the market to enhance the effectiveness of its role as an electronic registration institution.
In the future, the Korea Securities Depository plans to complement the testbed platform to transition to an operational environment in line with the passage and implementation timing of the security token bill, and to prepare for the introduction of the security token system without any hitches by organizing subordinate regulations.
It also announced that it will continuously support linkage testing between the distributed ledger and the testbed platform for participating institutions, and establish and publicly announce standards for business and system linkage with electronic registration institutions to actively support participation in the security token market.