South Korea’s Hanwha Investment & Securities has completed development of a tokenized securities platform built on the Avalanche public blockchain, the final piece of a deliberate, three-layer bet that positions one of Korea’s most powerful conglomerates across the entire infrastructure stack of the country’s emerging tokenized securities market. The timing is not a coincidence: the Avalanche platform lands just three days after South Korea’s Financial Services Commission (FSC) unveiled a three-phase implementation roadmap on September 4, crystallizing how the country’s capital markets will operate once a landmark legal framework takes effect on February 4, 2027.

Three layers matter here because three layers govern how a tokenized security actually moves through a market. An issuer needs infrastructure to mint and register a security token. Counterparties need settlement rails to exchange it for cash. Investors need secondary market access to trade it afterward. Hanwha Group has made significant investments in infrastructure for each layer — a pattern the company characterizes as diversification, but one that begins to look, in aggregate, like vertical integration of Korea’s nascent on-chain capital market before a single regulated trade has been placed under the new law.

The platform, built throughout 2025 in partnership with blockchain technology firm FairSquare Lab, is designed to run across multiple networks, including both the Avalanche C-Chain — the EVM-compatible public network where smart contracts execute — and Hyperledger Besu, a permissioned enterprise-grade Ethereum client developed under the Linux Foundation’s Hyperledger umbrella.

What the Avalanche Platform Does — and Why the Architecture Matters

The dual-architecture choice is not aesthetic. Hyperledger Besu, first contributed to the Linux Foundation’s Hyperledger project in 2019, runs a permissioning layer that allows only credentialed counterparties — in practice, FSC-licensed financial institutions — to join a network and participate in settlement. Transactions on a Besu-based permissioned chain are private by default, visible only to specified parties, and validated by known institutional nodes using Proof-of-Authority consensus. That makes it well-suited for the institutional-to-institutional settlement flows that will dominate Phase 1 of the FSC’s roadmap, where participants are regulated counterparties and regulatory certainty is the primary requirement.

The Avalanche C-Chain, by contrast, is a public blockchain with sub-second transaction finality and over 1.7 million active addresses as of early 2026. It supports Ethereum-compatible smart contracts, native USDC integration with Circle for stablecoin settlement, and composability with the broader DeFi ecosystem’s liquidity pools. That public connectivity is precisely what a permissioned chain cannot offer — and it is what the Bank of Korea specifically flagged as the critical bottleneck for Korea’s early-stage tokenized securities market.

In a May 2026 report, Bank of Korea Financial Stability Department researcher Sanghun Park wrote that securing trading liquidity is crucial for an early launch of South Korea’s asset tokenization market. A permissioned-only architecture solves the regulatory problem and creates a new one: all the liquidity in the world exists outside the walled garden. Hanwha’s dual-network architecture — permissioned flows on Besu for compliance, public C-Chain access on Avalanche for secondary market liquidity — is an engineered response to exactly that constraint.

Ava Labs, the company behind Avalanche, has positioned the network’s Evergreen Subnet product line specifically for financial institutions that need this synthesis. JPMorgan’s Project Guardian proof-of-concept and T. Rowe Price, WisdomTree, and Wellington Management’s 2026 participation in Avalanche’s institutional subnet infrastructure all run the same logic: KYC-gated access controls on top of a network that still connects to public liquidity when the trade window opens. Hanwha’s architecture mirrors that pattern applied to Korea’s specific regulatory context.

One reliability consideration a prospective user of the platform would want to understand: a February 2024 software bug caused a roughly five-hour halt of Avalanche’s Primary Network, affecting C-Chain settlement. No contractual SLA exists for the open public network. That incident is now more than two years in the past and the network has since deployed a major consensus upgrade (Avalanche9000) that reduced subnet deployment costs by approximately 99% and pushed transaction finality below one second on optimized configurations — but it remains part of the reliability record any financial institution deploying on the public C-Chain should weigh against the liquidity benefits.

FSC’s Three-Phase Roadmap — and What Is Still Undecided

The FSC’s September 4 roadmap established the first concrete timetable for how Korea’s tokenized securities market will actually operate.

Phase 1, beginning February 4, 2027, will permit the tokenization of privately placed money market funds, bonds, and unlisted stocks held through trust structures, as well as publicly offered fractional investment securities. Individual retail subscriptions are capped at whichever is smaller: ₩30 million (approximately $22,370) or 5 percent of an issuance, with mandatory minimum retail allocations required from issuers.

Phase 2 would extend tokenization to all publicly offered securities — a significantly larger market than Phase 1’s private-placement focus. Phase 3, the most architecturally ambitious, envisions on-chain payment rails allowing investors to settle tokenized securities using stablecoins, which would allow cash and security to move simultaneously on-chain rather than through traditional correspondent banking infrastructure. The FSC has indicated that the pace of Phases 2 and 3 will depend on how the Phase 1 rollout performs and where Korea’s pending stablecoin legislation lands.

Crucial regulatory detail remains unresolved. The FSC has committed to proposing revisions to relevant subordinate regulations by the end of September — weeks away — and to working alongside the Korea Securities Depository (KSD) to build out core tokenization infrastructure before the February go-live. Samsung SDS separately won a KSD contract to build a token securities management platform connecting the depository’s existing electronic securities account system to blockchain-based data, also targeting February 2027 completion.

What the subordinate regulations will specify — custody licensing requirements, disclosure standards, which specific asset structures qualify in Phase 1 — will determine the actual competitive landscape. Korean brokerages building platforms before those rules are finalized are making architectural bets on how the regulators will answer questions that are still open.

Avalanche’s Foothold in Korean Finance

Hanwha’s choice of Avalanche reflects where the network has been quietly building institutional relationships in Korea.

Mirae Asset Global Investments, South Korea’s largest multinational asset manager with over $300 billion in assets under management, previously signed a memorandum of understanding with Ava Labs to explore tokenized funds on Avalanche, targeting improvements in reporting, fee flows, distribution, and transfer agent operations. Mirae Asset Securities separately became the first Korean financial firm to issue digital bonds, raising ₩100 billion (approximately $70.1 million at the March 2026 exchange rate) through HSBC’s Orion tokenization platform linked to Hong Kong’s Central Moneymarkets Unit.

Not every Korean institution has converged on Avalanche. Shinhan Securities partnered with the Solana-based RWA platform Etherfuse to launch Korea’s first tokenized sales of Korean Treasury Bonds, purchasable with the dollar-pegged stablecoins USDC and PYUSD — a different technical architecture targeting a different product class.

The cluster of activity across multiple chains illustrates that Korean financial institutions are not waiting for February 2027 to experiment. They are building now, racing to have platforms in position when the legal framework goes live.

Three Rails, One Stack — and What That Implies

The Avalanche platform is the third component of a much larger blockchain infrastructure play taking shape inside Hanwha Group.

Hanwha Group holds a 9.6% stake in Securitize, spread across three Hanwha affiliates, making it the largest shareholder ahead of Blockchain Capital (6.0%) and co-founder Carlos Domingo (5.4%). Securitize listed on the New York Stock Exchange on July 2 following a SPAC merger, raising $400 million at a $1.25 billion pre-money valuation. It is best known as the infrastructure behind BlackRock’s BUIDL tokenized money market fund — and more broadly as a platform for the issuance and registry layer of tokenized securities. That is the first layer.

Separately, Hanwha Investment & Securities committed approximately ₩30 billion (approximately $22 million) to Digital Asset, the operator of the Canton Network — an institutional-grade blockchain designed for financial market infrastructure and DvP (Delivery-vs.-Payment) settlement between known counterparties. That investment came as part of Digital Asset’s $355 million fundraising round and followed an earlier memorandum of understanding between Hanwha and Digital Asset signed in April. Shinhan Investment Corp. and Shinhan Venture Investment also participated in the Digital Asset round. Canton is the settlement layer.

The Avalanche platform now adds the third: secondary market and retail-accessible liquidity infrastructure on a public blockchain, connected to the broader DeFi ecosystem.

Mapped onto a settlement stack, the three investments cover issuance (Securitize), institutional settlement (Canton/Digital Asset), and secondary market liquidity (Avalanche). A conglomerate with ownership or infrastructure positions across all three layers of the settlement stack for a newly regulated market would be structurally positioned in ways that go beyond financial diversification — it would own the pipes through which every other market participant’s transactions flow. Whether Korean regulators, who have flagged investor protection and trust as primary policy priorities for the new framework, will view that concentration as beneficial infrastructure leadership or as a conflict requiring structural scrutiny is a question the subordinate regulations have not yet answered.

What the Market Is Building Toward

The urgency behind these moves reflects the size of the opportunity Korea’s regulatory architecture is designed to unlock.

Korea’s cumulative fractional investment market stood at approximately ₩640 billion (approximately $477 million) as of May 2026 — a modest base relative to the global tokenized RWA market, which crossed approximately $28 billion in mid-2026. Under the new legal framework, Boston Consulting Group, as reported by the Korea Economic Daily, has forecast the South Korean token securities market could reach ₩367 trillion (approximately $274 billion) by the end of this decade.

The Bank of Korea’s May 2026 report was explicit about what determines whether those projections are realized: sufficient secondary market liquidity for trading to become active. The Korea Capital Market Institute’s Senior Research Fellow Hwang Se-woon separately noted that the framework’s most significant innovation is recognizing the distributed ledger as a securities register with legal effect — which transforms tokenized securities from experimental instruments into legally equivalent alternatives to traditional electronic securities, opening custody, repo, and collateral management to on-chain infrastructure for the first time.

What comes next, in the near term, is the FSC’s subordinate regulations package, expected before the end of September. Those rules will determine which specific assets can be tokenized in Phase 1, what custody and disclosure standards apply, and what the licensing pathway looks like for platform operators. For Hanwha — already holding infrastructure stakes across three layers of the stack — how those rules are written will determine how much of the value that flows through Korea’s tokenized securities market flows through its infrastructure.

KRW-to-USD conversions use the mid-market rate of ₩1,341.5 per US dollar as of September 7, 2026, except where otherwise noted for historical transaction values at the time of issuance.

Frequently Asked Questions

What is a tokenized security, and how is it different from a cryptocurrency?

A tokenized security is a traditional financial asset — a stock, bond, fund unit, or real estate interest — represented and tracked on a blockchain, fully subject to securities regulations. The token is the record, not the asset; the underlying legal rights are identical to a conventionally issued security. Cryptocurrencies, by contrast, are independent digital assets with no underlying physical or financial asset backing them. The key practical difference: tokenized securities fall under the same investor protection, disclosure, and custody requirements as any other regulated security, and can only be traded on licensed platforms.

When will South Korean investors actually be able to buy tokenized securities legally?

The FSC’s three-phase roadmap establishes February 4, 2027 as the date the amended Capital Markets Act and Electronic Securities Act take effect, creating the first legal pathway for regulated tokenized securities issuance and trading in Korea. Phase 1 will cover privately placed money market funds, bonds, unlisted stocks in trust structures, and fractional investment securities. Retail access will be subject to caps of ₩30 million (approximately $22,370) or 5% of an issuance, whichever is smaller. Crucially, the subordinate regulations that specify which assets qualify and what custody standards apply are not yet final — the FSC has committed to publishing proposed rules by the end of September 2026.

Why does Hanwha’s combination of Securitize, Digital Asset/Canton, and Avalanche matter beyond standard financial diversification?

Each investment targets a distinct layer of the infrastructure through which tokenized securities actually move: Securitize handles issuance and registry (where a token is minted and ownership recorded), Digital Asset’s Canton Network handles institutional settlement (where cash and securities are exchanged between counterparties), and the Avalanche public blockchain platform handles secondary market access and retail-accessible liquidity. Together they span the full settlement stack. No other single Korean financial institution — and few globally — holds infrastructure positions across all three layers simultaneously. Whether that constitutes a competitive advantage or a structural concentration that regulators will want to examine is an open question as Korea writes its subordinate rules.

What is the technical reason Hanwha chose a public blockchain (Avalanche) alongside a permissioned one (Hyperledger Besu)?

The Bank of Korea specifically identified liquidity as the primary bottleneck for Korea’s early-stage tokenized securities market: a secondary market cannot function unless buyers and sellers can find each other efficiently. Permissioned blockchains — like Hyperledger Besu — restrict who can participate to credentialed known counterparties, which creates regulatory certainty but limits the pool of potential buyers and sellers to a closed set of institutional participants. The public Avalanche C-Chain connects to a much larger liquidity pool, including retail investors and international participants, but requires compliance infrastructure (KYC checks, smart contract-level access controls) layered on top. The dual-network architecture is Hanwha’s engineering response to serving both requirements simultaneously.