South Korea delays decision on licensing OTC platforms for securities

The focus of South Korea’s financial circles is on a critical decision regarding over-the-counter (OTC) exchanges for security tokens, which remains unresolved at this time. According to NS3.AI, the review process has been completed; however, final approval from the Financial Supervisory Service (FSC) has not yet been granted. Two consortia, led by the Korean exchange KRX and Nextrade, have already received preliminary approval, while the exclusion of the Lucentblock consortium has sparked a debate about fairness in the selection process.

Uncertainty in Regulatory Development

Although the FSC has completed all necessary document reviews, the issue remained unresolved during a meeting earlier this month. Such delays in decision-making often reflect the complexity of South Korea’s regulatory environment concerning digital assets. The agency appears to be cautious in determining the final list of permitted players in the OTC security token market.

Controversy Over Participant Selection

The most heated public discussion in South Korea concerns the exclusion of Lucentblock. This has led to conversations about potential biases in the selection process and raised questions about the criteria FSC uses to make its decisions. Receiving preliminary approval from the other two consortia is a market signal, but final approval is still pending. The outcome of this decision could have significant implications for the development of the security token market on blockchain in South Korea.