A South Korean cryptocurrency exchange has received a notice from the police requesting the seizure of funds related to the Luna Foundation’s expenses.
May 23, 2022, South Korean authorities sent a request In order to prevent funds from being withdrawn, the top cryptocurrency exchanges in Korea, especially the Seoul Metropolitan Police Agency, have asked the Luna Foundation Guards not to take any action. police claim A clue has been found that could link the organization to the embezzlement.
The Luna/Terra algorithm stablecoin crash, which reduced the coin value by more than 99%, toppled investor portfolios overnight earlier this month.
However, this request is not a requirement and cannot be enforced by law. Each exchange can choose how to respond, but how it will respond is still unknown.
Several prominent Korean investors have requested that Terraform Labs CEO Kwon Do be investigated and sued for the collapse of the UST stablecoin. This triggered the revival of the ‘Sashin’, a joint financial and securities crime investigation team.
Korean lawmakers even met with executives from exchanges such as Upbit, Bithumb, Coinone, Korbit, and Gopax. This meeting is likely a move to put pressure on the heads of these exchanges, as there are no compliance obligations.
According to newspimYoon Chang-hyeon, chairman of the Special Committee on People’s Virtual Assets, said on Facebook, “We will review the measures to protect investors of the exchange.”
Relevant: Huobi Global co-founder said the Terra crash is not a risk to the broader crypto ecosystem.
It is reasonable to expect that exchange representatives will be held accountable in some way for the damage caused to investors by the LUNA crash, the report said. Newspim also reported that the National Assembly is leading the way in penalizing the matter.
2 exchanges already We have issued a warning on our website.Coinone has already stopped trading LUNA as of May 11th, and Binance has also suspended some spot trading.
Although this official report joined the broader development story, the request for cryptocurrency exchanges and the metropolitan investigation were not linked. Actions from the National Assembly and South Korean authorities make it clear that South Korea is willing to take the necessary steps to reach the bottom of the Terra ecosystem collapse imbroglio.