South Korea’s financial regulators have openly expressed alarm over the Terra ecosystem’s LUNA and UST tokens collapsing. As a result, they requested information from local exchanges regarding the volume of trade processed on these two cryptocurrencies.
Furthermore, a member of the current government wants Do Kwon to appear before a parliamentary committee.
South Korean financial officials have openly expressed concern over the collapse of the Terra ecosystem’s LUNA and UST tokens. As a result, they requested data from local exchanges on the volume of transactions on these two cryptocurrencies. Furthermore, a current government member wants Do Kwon to testify before a legislative committee.
The ramifications have spread well beyond the cryptocurrency community.
We just discovered that financial regulators in South Korea, notably the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS), had chosen to intervene.
Do Kwon, the CEO, and co-founder of Terraform Labs, Terra’s parent business, is a South Korean national, despite the fact that Terraform Labs’ offices are in Singapore.
Furthermore, the two regulatory agencies stated above have asked local cryptocurrency service providers to submit information on their transactions connected to the LUNA token and the UST, according to sources from major South Korean exchanges.
As a result, the exchanges involved were forced to reveal information such as the respective trading volumes for the two tokens, their closing prices, and the number of investors affected by their decline.
Furthermore, the authorities ordered them to conduct their own examination of the situation and to report on any actions taken to minimize the damage to the investors.
More regulation is needed to protect users.
According to an unnamed person working for one of the platforms involved, financial regulators wish to avoid a repeat of this situation:
Last week, financial authorities demanded information on the number of transactions and investors, as well as tangible measures of exchanges.
I assume they did this to develop methods to protect investors in the future.
According to Jeong Eun-bo, the head of the Financial Supervision Service, recent occurrences may have a significant influence on investors’ confidence in the market as a whole.
He goes on to say that, despite the lack of clear legislation involving cryptocurrencies, the organization must nonetheless figure out the ins and outs of Terra’s demise.
Finally, he believes that it is now critical that the regulatory agencies of all nations work together to develop a viable mechanism to control the entire bitcoin sector.
In the same media, a representative of a financial organization indicates that the government can only participate as a passive observer for the time being:
“Regarding the Luna incident, we are monitoring the general development of the situation, but there is no direct action the government can take at this time. There is no reason for the government to intervene because cryptocurrency transactions are operated freely by the private sector. »
Does Kwon appear before the commission soon?
Yun Chang-Hyun, a conservative People Power Party lawmaker, indicated an intention to organize a parliamentary inquiry on the incidents attributed to Terra, with Do Kwon in attendance:
“We should bring relevant exchange officials, including Do Kwon, the CEO of Terra who has become a recent issue, to the National Assembly to hold a hearing on the cause of the situation and measures to protect investors. . »
Do Kwon, on the other hand, appears to want to try to raise the standard, having proposed a hard fork of the Terra blockchain and the creation of a new LUNA token on Monday, May 16. To now, 90 percent of voters have chosen to reply adversely to Do Kwon’s plan, with the majority favoring a burn of extra LUNA tokens in particular.