South Korea launches ‘emergency’ inspections on local crypto exchanges

South Korea’s Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) have launched emergency inspections on the crypto market.

The increased scrutiny follows the recent downfall of Terra’s native coin TerraUSD (UST) and LUNA caused mammoth losses, according industry sources cited in a report by Yonhap.

A representative for a local South Korean cryptocurrency exchange operator told Yonhap: “Last week, financial authorities asked for data on the amount of transactions and investors, and sized up the exchanges’ relevant measures… I think they did it to draw up measures to minimize the damage to investors in the future.”

Co-founded in 2018 by Daniel Shin and Do Kwon, Singapore-based Terraform Labs are the developers of TerraUSD and LUNA.

An algorithm was created by the company to keep UST pegged 1:1 to the US dollar. This was designed though incentivizing arbitrage and token destruction between the UST and LUNA coins.

Last week the world saw the system buckle as UST plummeted below $0.15 with LUNA depleting to nearly zero. This hit investors particularly hard in South Korea as according to Yonhap, around 200,000 have invested in both TerraUSD and LUNA.

As per a report by Korea JoongAng Daily, the Korean financial authorities have been monitoring the crypto market since the collapse, with investor protection currently the only action taken.

A spokesperson for the financial authorities told Yonhap: “There is no ground for the government to intervene because coin transactions are being freely operated by the private sector. In regards to the Luna incident, we are monitoring the overall situational changes, but there isn’t a direct measure the government can take at this moment.”

While the global crypto market waits for both coins’ increase in market value, in the meantime, if you are looking to play at crypto casinos we recommend going to Bitcasino, 1xBit or FortuneJack.

Source

Updated: 05/17/2022 — 15:00