South Korea plans inspections – The South Korean authorities are far from done with Terra (LUNA). Regulators want to tighten the noose around the project, but also around cryptocurrencies in general and scholarships in the country.
The Terra earthquake on the menu of the meeting of South Korean regulators
The Financial Supervisory Service (FSS), the Fair Trade Commission (FTC) and the Financial Services Commission (FSC) in South Korea held, on May 24, 2022, a emergency meeting to the National Assembly, following thecollapse of stablecoin TerraUSD (UST).
The Financial Services Commission’s investigative unit called the earthquake that shook the crypto industry a lot, “Whirlwind of Death”. She estimates there were 100,000 LUNA holders in South Korea before the cryptocurrency crashed. This number would then reach 180,000 within 10 days of losing the UST’s peg to the US dollar.
Regulators therefore make decisions. The Financial Monitoring Service has indeed announced that it plans to carry out inspections at the premises of companies that supply Terra-related financial services.
The inspections will cover different areas such as:
- payment services involving Terra;
- the management of the continuity of these services;
- the status of funds withdrawn;
- the standards in force for the protection of users.
Chan-woo Leevice president of the service announces that investigations will be carried out on the ground. It is then a question of prevent the risk of a possible contagion of this crisis on the traditional financial markets.
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South Korean stock markets under pressure
The collapse of Terra tokens has also led regulators to take other initiatives to further regulate the crypto industry.
The Financial Monitoring Service wants to create a research service. He will analyze the risks weighing on cryptocurrencies circulating on South Korean exchanges. These cryptocurrencies will be categorized according to their risk profile.
In addition, the Fair Trade Commission wants to verify the compliance level cryptocurrency exchanges. The goal? Check that the 2021 guidelines for corrections are applied to exchanges’ terms and conditions of sale.
16 scholarships South Korean nationals are therefore invited to review these terms. They were perceived by the Commission as being unfavorable to their users:
“Starting in June, we will intensively check whether recommendations for the correction of 20 types of unfair terms and conditions are implemented, and we will issue a correction order if necessary. »
The Fair Trade Commission also stresses the need for “consistency with global regulations and strengthen the cooperative system”. Only this consistency will allow the effectiveness of the regulatory framework governing virtual assets.
Terra may be backbut regulators do not want to pass the towel on the recent debacle of the ecosystem.
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