When the Code Keeps its Promise but the Contract Doesn't: A Governance Gap in South Korea's Tokenized Securities Framework

Abstract

When a smart contract executes exactly as programmed, it can still fail to do what the parties actually agreed to. This paper examines a structural gap between legal contracts, written in ordinary language that tolerates ambiguity by design, and executable code, which cannot process ambiguity at all. Drawing on Accord Project's own teaching documentation, the paper shows that even the most influential open-source framework for smart legal contracts treats deliberately open legal standards, such as "in the receiver's opinion" or "force majeure," as simple binary variables, embedding legal indeterminacy into code without resolving it. This gap acquires particular urgency in South Korea, where a February 2027 deadline requires tokenized securities platforms to register under a new distributed ledger framework, amid technological fragmentation across at least five competing architectures and a "digital native" model in which the ledger itself, without a parallel central registry, becomes the sole legal record. The paper argues that closing this gap does not require new technology, but a governance requirement modeled on a well-established regulatory pattern found in civil aviation and other fields: certifying verifiable outcomes without prescribing the specific technique used to achieve them. It concludes with a concrete recommendation for Korea's forthcoming distributed ledger standard requirements guideline.