The Financial Intelligence Unit (FIU) of South Korea’s Financial Services Commission disclosed on Tuesday that LUNA and UST holders grew dramatically following the crisis, looking for a price recovery.
According to local media accounts, the South Korean government is now taking further efforts to prevent another Terra-like accident. The collapse of Terra’s UST stablecoin and LUNA in early May resulted in billions of dollars in losses for investors all across the world.
The number of users affected by the collapse was revealed by South Korea’s Financial Intelligence Unit at the National Assembly’s “Emergency Check on Digital Assets Basic Act and Coin Market Investor Protection Measures” meeting on May 24. According to the FIU report, South Korea has 280,000 investors owning roughly 80 billion tokens. On the other hand, on May 6, only 100,000 users held 3.17 million tokens.
The Financial Services Commission’s deputy chief, Kim So-young, told local news source Naver:
“In order to draw up effective regulatory systems on crypto assets, we will closely review overseas cases of regulations and strengthen cooperation with international organizations and major countries.”
Meanwhile, during the “Enactment of the Digital Asset Framework Act and Emergency Inspection of Coin Market Investor Protection Measures” conference, South Korea’s Financial Supervisory Service (FSS) disclosed intentions to analyse and manage the risks of the UST and LUNA crashes.
On-site inspections of enterprises offering financial services relating to the Terra project will be conducted by the FSS. The inspection will look at the service’s upkeep, withdrawal money status, and the effectiveness of user protection measures.
The Financial Supervisory Service also intends to assess the risk of virtual assets and monitor domestic and international virtual asset markets. The authority emphasizes the necessity of crypto market monitoring, claiming that Terra’s demise was caused by a flawed algorithm, large short-selling attempts, and a lack of LFG support.