The South Korean government reportedly plans to call Terra's founder Do Kwon to give an explanation in parliament regarding the issue that befell Terra.
The move comes after the Terra project was destroyed leading to a fall in market value from $ 40 billion to nearly $ 1 billion within a week. The collapse has sparked outrage and criticism among investors. This series is also, some governments have called for more regulations on crypto to be imposed.
Based on the report, South Korean politician Yoon Chang-Hyeon raised questions that need to be discussed about the recent Terra crash in a plenary meeting. He stressed the need for clarification as it has influenced market patterns and had an impact on crypto exchanges. Major Korean exchanges such as Coinone, Korbit and Gopax have stopped trading their UST and LUNA on May 10, while Bithumb and Upbit did so on May 11 and May 13.
Yoon called for crypto exchange officials and Do Kwon to be called in to investigate the cause behind the historic accident. However, he also raised about the need to enact laws that protect investors.
UST stablecoin Terra previously held a market capitalization in excess of $ 18 Billion. UST which was supposed to be pegged to the US dollar is now trading at an average price of $ 0.124 and the ensuing collapse caused the value of market capitalization to drop to $ 1.4 Billion.
Yoon mentioned that every trade in the market helps the crypto exchange generate commissions from them. During a market crash, Upbit was the last platform to stop trading for LUNA. The exchange then became the highest -performing company in generating commission revenue of 80%. A string of all that, Yoon raised the voice for the need for strict laws on the crypto market to protect investors.
South Korean financial authorities have already begun an investigation into the crypto exchange. The Financial Supervisory Services (FSS) and the Financial Services Commission (FSC) have asked the exchange to provide details on UST and Luna’s transactions. The report will also cover trading volume by number of investors and their closing prices.
