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- The market capitalization of the two coins was reduced by around $45 billion. Luna’s value had plummeted from around $80 at the beginning of May to around nothing by May 12.
- The National Assembly is considering 13 crypto market regulating proposals. TerraUSD (UST) lost its peg to the US dollar earlier this month, and the death spiral began. The sibling currency LUNA, which helped keep the US dollar pegged, also fell.
- The FSC, Financial Intelligence Unit, and Financial Supervisory Service are presently reviewing Terra’s whitepaper and other papers. This is being done to figure out what caused the collapse, how much damage was done, and how to prevent it from happening again.
The breakdown of the Terra climate sent shockwaves through the cryptographic money environment, pulling the whole market down with it. The fiasco has highlighted concerns about the validity and long-term viability of algorithmic stablecoins, as well as the need for market regulation. As per The Korea Times, South Korean controllers are attempting to reinforce reconnaissance and guideline of digital currency trades directly following the debacle.
The Terra-Luna Disaster Has Impacted Roughly 280,000 South Koreans
Crypto exchange CEOs and high-ranking government officials addressed strategies to prevent future disasters like the Terra-Luna collapse at an emergency two-day National Assembly conference that ended on May 24. The seminar was attended by representatives from the country’s main exchanges, including Upbit, Bithumb, Coinone, Korbit, and Gopax.
At the seminar, People Power Party leader Sung Il-jong said: We need exchanges to play their proper role, and watch dogs must closely monitor them to that goal, says the author. When exchanges break the rules, they should be held legally accountable to guarantee that the market runs smoothly.
The Financial Services Commission is also interested in: establishing close relations with the Ministry of Justice, the prosecutor’s office, and the police in order to keep an eye on any criminal activities in the industry and defend investors’ rights,
FSC Vice Chairman Kim So-young stated. According to the FSC, the Terra-Luna disaster has impacted roughly 280,000 South Koreans. FSC Vice Chairman Kim So-young stated. According to the FSC, the Terra-Luna disaster has impacted roughly 280,000 South Koreans.
According to Yonhap News Agency, So-young also stated that the country has to strengthen international cooperation to successfully manage the digital assets market due to its decentralized structure.
According to the report, So-young said: We will closely analyze cases of regulation and improve collaboration with international organizations and major countries in order to draft appropriate regulatory systems on crypto assets, says the statement.
Terraform Labs, the business behind the Terra environment, and its CEO, Do Kwon, are now being examined by South Korean specialists. The Seoul cybercrime police department has requested that Terraform employees suspected of embezzlement have their assets frozen.
According to Newsis, the FSC, Financial Intelligence Unit, and Financial Supervisory Service are presently reviewing Terra’s whitepaper and other papers. This is being done to figure out what caused the collapse, how much damage was done, and how to prevent it from happening again.
The prosecution, on the other hand, is investigating Do Kwon’s role in the disaster and whether he committed any fraud in connection with the Terra-Luna project. A law firm in South Korea has filed a lawsuit on behalf of investors who were harmed by the collapse.
The Market Capitalization Reduced By Around $45 Billion
It’s uncertain whether Terraform Labs will be held liable for the losses due to a lack of legislation and monitoring organizations with limited authority. According to a Yonhap article, the National Assembly considers 13 crypto market regulating proposals. TerraUSD (UST) lost its peg to the US dollar earlier this month, and the death spiral began. The sibling currency LUNA, which helped keep the US dollar-pegged, also fell.
Within a week, the market capitalization of the two coins was reduced by around $45 billion. Luna’s value had plummeted from around $80 at the beginning of May to around nothing by May 12. While Do-Kwon has been working to restore the Terra ecology, things are currently looking bleak. The bigger cryptocurrency market continues to grow.
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Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
