20 July 2026
South Korea May Hold Exchanges Responsible For Terra Crash
As per Newspim reports, the ruling party of South Korea has arranged 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 converse the outcomes of loss of $40 billion from the Terra collapse.
According to the reports, the Crypto exchanges are to be held responsible for the damages suffered by investors. They are accused of being failed to implement enough traders’ protection and stop clients’ losses during the collapse.
Yoon Chang-Hyeon, the ruling party member and chairman of the parliament’s special virtual assets committee said in a Facebook post, “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. Additionally, 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.
South Korea’s financial regulatory authorities are also investigating all 34 crypto-related companies, including eight crypto wallets, 26 crypto exchanges, and security management agencies. They checked if Crypto exchanges have appropriately applied all the essential customer protection tools and anti-money laundering.
The CEO of TerraForm Labs, Do Kwon, has 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.
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