Hanwha taps Avalanche for tokenized securities ahead of 2027 rules

Hanwha Investment & Securities has completed a tokenized securities platform built to run on Avalanche, Seoul Economic Daily reported Sunday, placing the Layer 1 network inside South Korea's regulated capital markets months before blockchain-based securities become legal in February 2027.

The brokerage began developing the system in 2025 with blockchain firm FairSquare Lab, according to the report citing blockchain industry sources. The platform supports multiple distributed ledgers, including Avalanche and Hyperledger Besu, an Ethereum-compatible network built for enterprise deployments. Hanwha declined to comment on the report.

The Korea Securities Depository, which operates the country's central securities infrastructure, is preparing systems that can connect with Avalanche, Hyperledger Besu and Hyperledger Fabric, giving securities firms several ledger options under the incoming framework. A KSD official told Seoul Economic Daily that demand from financial companies influenced the inclusion of Avalanche, with several firms requesting support through industry consultations.

Avalanche's role in regulated tokenized securities already has a track record in Asia. In July, Japan's 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 — representing more than 452 billion yen in underlying assets. Progmat redesigned its architecture so business functions no longer depend on a single blockchain, using a separate layer between applications and the underlying ledger.

South Korea's three-stage rollout

Hanwha's platform lands as the Financial Services Commission finalizes the operating structure for tokenized securities. The regulator unveiled a three-stage implementation roadmap on Sept. 4, covering which securities can initially be tokenized and how the market could expand after amendments to the Electronic Securities Act and Capital Markets Act take effect on Feb. 4, 2027.

The first stage covers privately pooled money market funds, bonds reserved for institutional investors, unlisted shares issued through trust structures and publicly offered fractional investment securities. The second phase would extend tokenization to all publicly offered securities, with no fixed date set. The final stage would build onchain payment infrastructure linked to stablecoins, allowing the payment side of tokenized securities transactions to move onto blockchain rails — timing that depends partly on pending South Korean stablecoin legislation.

Retail investors face limits under the framework. The FSC has proposed capping individual subscriptions to non-monetary trust beneficiary certificates at the lower of 30 million won or 5 percent of total issuance, with annual net purchases on each OTC exchange capped at 100 million won. Existing securities firms can handle tokenized products under their current licenses, while non-bank issuers managing investor accounts must hold at least 4 billion won in equity capital.

Hanwha's tokenization build-out

The brokerage has spent years building positions across tokenization infrastructure. Hanwha became Securitize's largest shareholder after holdings across three affiliated entities reached a combined 9.6 percent, or 15.69 million shares, according to U.S. regulatory filings. Securitize, which provides tokenized asset infrastructure for BlackRock, Apollo, BNY and KKR, managed more than $4 billion in onchain assets and supported more than 650 tokenized funds earlier this year. The company listed on the New York Stock Exchange under the ticker SECZ in July.

Hanwha Investment & Securities has also invested 30 billion won, roughly $22.3 million, in Digital Asset, operator of the institutional Canton Network, and raised its stake in Dunamu, the operator of Upbit, to 9.84 percent with a 597.8 billion won investment.

The convergence of Hanwha's platform, KSD's multi-ledger infrastructure and the February legal framework gives Avalanche a concrete path into one of Asia's largest retail investment markets. Whether the network captures meaningful issuance volume depends on how many securities firms follow Hanwha's lead and how quickly the first-stage products clear the FSC's stability and efficiency benchmarks.

This article is for informational purposes only and does not constitute investment advice.