Shares of tokenization platform Securitize rallied sharply on Tuesday after the company announced a partnership with South Korean IT services firm LG CNS, as the country prepares to introduce a new regulatory framework for tokenized securities, meaning traditional instruments such as stocks, bonds and funds represented as digital tokens on a blockchain.

Securitize (SECZ) climbed nearly 8% in early Tuesday trading to around $12.60, outperforming most major crypto-linked stocks, before pulling back later in the morning, according to market data. The company began trading on the New York Stock Exchange in July after completing its merger with special purpose acquisition company Cantor Equity Partners II.

In a post on X, Securitize said it signed a memorandum of understanding with LG CNS to develop tokenized assets and digital asset infrastructure for South Korean financial institutions. The companies said the partnership will explore tokenized funds, stocks and stablecoins, while also identifying opportunities across the broader Asia-Pacific market. LG CNS is the IT services arm of South Korean conglomerate LG Group.

The agreement comes as South Korea moves toward a regulatory regime for tokenized securities. Last week, the country's Financial Services Commission, the top regulator overseeing South Korea's financial markets, proposed rules governing the issuance and circulation of tokenized stocks, bonds, funds and other securities, with the framework set to take effect in February 2027, per the regulator's announcement. The fixed 2027 effective date sets a clear timeline for institutions planning tokenized offerings under the new regime.

The partnership potentially gives Securitize an early foothold in the South Korean market as financial institutions prepare for the new regime. LG CNS also launched a blockchain infrastructure platform on Tuesday designed to help banks and other financial companies support stablecoins and tokenized securities.

Tokenized Stocks Emerge as the Next Major Tokenization Market

Securitize has become a major player in the tokenized real-world asset market, which has grown to roughly $40 billion. Much of the early growth centered on US Treasurys, private credit and other yield-bearing assets, but tokenized stocks are beginning to gain ground.

The market for tokenized stocks has repeatedly hit record highs as exchanges and financial institutions explore bringing traditional equities onchain. Tokenized equities were valued at roughly $3.2 billion, up 10.6% over the past 30 days, according to RWA.xyz data.

Securitize CEO Carlos Domingo has argued that even modest adoption could have a much larger impact on crypto markets. Speaking at ETHConf in July, Domingo said tokenized stocks could help push the overall crypto market to a $5 trillion valuation.