FSC grants preliminary approval for a 'fractional investment OTC exchange'… Busan secures Korea’s first exchange dedicated to secondary trading

Busan said it has secured the country’s first exchange dedicated to the secondary trading of fractional investments, following the Financial Services Commission’s (FSC) preliminary approval for a fractional investment over-the-counter (OTC) exchange.

According to the industry on the 15th, Busan said that at the FSC’s regular meeting on the 13th, the 'KDX Consortium'—formed around the Korea Exchange (KRX) and Koscom—received preliminary approval for a fractional investment OTC exchange. The approval is the first case under the newly introduced 'licensing regime for fractional investment OTC exchanges,' which the FSC created to facilitate smooth circulation of fractional investment securities and strengthen investor protection.

The KDX Consortium is a large alliance involving about 40 institutions, including 24 domestic securities firms as well as fractional investment operators and fintech, blockchain and IT security companies. It is said to have a financial base with paid-in capital of more than KRW 90 billion and the capability to build top-tier trading infrastructure nationwide. Regional finance and digital firms—including BNK Investment & Securities and Busan Bank and Kyongnam Bank—also participated, enhancing local linkages.

Busan has operated the 'Busan Blockchain Regulation-Free Zone' and has pursued demonstration projects such as digital IDs, digital vouchers and real estate fractional investment. Through these efforts, it has accumulated policy and technical experience in blockchain and digital finance, and says this exchange attraction is a result of that progress.

The consortium plans to establish the exchange’s headquarters in Busan, dedicated to fractional investment trading, and to build the core IT system within this year. Busan expects spillover effects on the local economy through the inflow of specialized talent and clustering of related industries.

Fractional investment securities are financial products that issue and distribute real assets—such as real estate, copyrights and artworks—in the form of digital securities. They are drawing attention as a means to diversify funding channels and promote capital market innovation. Busan also projected the potential to issue products linked to locally specialized industries such as shipbuilding, ports, automobiles, machinery, tourism and culture.

Busan Mayor Park Heong-joon said, "Busan’s attraction of this fractional investment exchange is the result of efforts to attract companies, build infrastructure and cultivate talent as a blockchain special-zone city, in response to Yeouido, the traditional hub of finance," adding, "We will do our utmost, in close cooperation with the FSC, the KRX and other relevant institutions, to ensure that tokenized securities and the digital finance industry can take root stably in Busan."