The ruling party of South Korea is likely to host an urgent meeting on Tuesday with officials from the state’s top five largest crypto exchanges. The officials look forward to holding crypto exchanges accountable for their failure to save traders during the Terra crash.
According to the news reports of a local channel, Newspim, the ruling party of South Korea has planned an urgent meeting on May 24, 2022, with the officials of the top five crypto exchanges working in the state, including Korbit, Gopax, Upbit, Coinone, and Bithumb for conversing the outcomes of loss of $40 billion from the Terra collapse.
The reports indicate that the crypto exchanges are to be held responsible for the damages suffered by investors. They failed to implement enough traders’ protection and stop clients’ losses during the collapse.
South Korea’s ruling party member and chairman of the parliament’s special virtual assets committee, Yoon Chang-Hyeon, stated in a Facebook post on Monday, “we will check [the exchanges’] investor protection measures.”
Last Tuesday, Chang-Hayeon had already stressed the urgent meeting of the National Assembly to investigate the Terra crash. Furthermore, the ruling party member expressed concern about the conduct of local crypto exchanges during the Terra crash. High transaction fees and trading volumes encouraged crypto exchanges to keep the UST and LUNA trades open despite clear client risks.
Apart from the above investigation, South Korea’s financial regulatory authorities look into all 34 crypto-related companies, including eight crypto wallets, 26 crypto exchanges, and security management agencies. Furthermore, they evaluate if crypto exchanges have appropriately applied all the essential customer protection tools and anti-money laundering, as per Newspim.
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Seong Il-jong, chairperson of the policy committee, Jae-ok Yoon, chairwoman of the political affairs committee, Kim Hee-gon, secretary of the political affairs committee, and Yoon Chang-Hyeon, virtual asset special chairperson of the ruling party, will attend the meeting. Other panel participants include Kim Jeong-gak, deputy chairman of the Financial Services Commission and president of the Financial Intelligence Unit (FIU), officials from adjacent ministries such as the Financial Supervisory Service and the Fair Trade Commission, and the National Police Agency.
As per local news reports, Do Kwon, the CEO of TerraForm Labs, has purportedly been invited to the urgent meeting interview. However, the Southern District Prosecutors of Seoul are already probing Do Kwon on doubt of running Ponzi maneuvers by advertising unfeasible outcomes on UST deposits through the Anchor Protocol. The investigations began when South Korean investors announced their intention to sue Kwon and his co-founder, Daniel Shin, for financial misdeeds and deceit related to the Terra disaster.
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