Recently a South Korean news channel reported that the country is shifting its responsibility for the crash of crypto exchanges Crypto Terra, Luna, and the algorithmic stablecoin Terra UST (UST).
Following the collapse of stablecoins TeraUSD and Luna, the Korean government is now planning to introduce stricter regulations on virtual currencies, including a unified listing standard.
The Korean National Assembly and the government convened an emergency meeting with the South Korean heads of major crypto exchanges to discuss measures to prevent a recurrence of the Luna and UST explosion.
The meeting was attended by lawmakers and financial officials in support of enforcing stricter regulations on cryptocurrency, as reported by the publication.
The Korean government had criticized crypto exchanges by delaying the removal of LUNA and a late response to the collapse of the two cryptocurrencies.
While South Korean companies delayed LUNA’s removal and most companies reacted too late to the collapse, some critics in the country have called it a deliberate act to gain more commission on the incident.
Officials react to regulatory explosion
The ruling power party, Rep Eun Chang-hyun, has raised concerns over the unclear listing and delisting standards of crypto exchanges, further emphasizing:
“The exchanges do not have a unified listing standard, nor do they negotiate this issue.”
Responding to the enforcement of tough crypto regulations, Lee Sigaro, the CEO of the country’s top crypto exchange Upbit works at, Dunamu said that it will not solve the problem.
“Crypto-assets can be sent to foreign exchanges, and many crypto investors are already using non-Korean headquartered exchanges.”
Furthermore, during the meeting, Rep Sung Il-jong of the Janshakti Party said that:
“We need exchanges to play their due roles, and to that end, it is important for watchdogs to monitor them thoroughly.”
He also added: “When exchanges violate regulations, they should be regularly held accountable for ensuring that the markets function well without any hassles.”
Meanwhile, Kim Soe-young, vice chairman of the country’s top financial regulator FSC (Financial Services Commission), said that:
“We are going to build closer ties with the Ministry of Justice, prosecutors and police to monitor any illegal acts in the industry and protect the rights of investors.”
Furthermore, another official from domestic crypto exchanges, responding to the criticism of the government of South Korea, said:
“Exchanges can easily become the target of criticism in a period when no specific regulatory guidelines have been introduced.”
“We understand the purpose of the meeting, but the most urgent step is to call the company’s co-founder Do Kwon to the authorities as soon as possible,” he added.