According to the resources, the police have issued notices to South Korean-based cryptocurrency exchanges in which it is requested to close off the funds of the Luna Foundation Guard. South Korean officials requested the main cryptocurrency exchanges of the country to ensure that funds can’t be withdrawn. Particularly, the Seoul Metropolitan Police Agency requested to restrict LFG from taking any kind of action.
According to the police department claim, there has been seen evidence that may connect the firm to fraud. This month proved heavy on the investors as the crash of the Luna algorithmic stable coin has reduced the coin’s value by more than 99%.
However, South Korean officials just requested, not demanded and this is not applicable by law. Now, it’s up to the exchanges how they want to respond, but it’s unclear what will be their reaction? Many high-profile investors in South Korea requested the officials that Terraform Labs Chief Executive Officer Do Kwon should be investigated and filed a petition to collapse UST stablecoins. The Korean investors’ request caused a Korea-based Financial and Securities Crime Joint Investigation Team Grim Reaper’s revival.
South Korean lawmakers have a meeting with executives of all major exchanges like Coin one, Gopax, etc. this meeting’s purpose is just to increase pressure on executives of these exchanges. According to the report of Newspim, Chang Hyeon (chairman of the people’s Strength Virtual Assets Special Committee) told that they will examine the exchanges’ investor safety steps. It is fair to suppose that the exchanges’ representatives will be declared answerable in any way, for damage done to the investors through LUNA crash. The National Assembly of South Korea is going to take measures for regulating punishment regarding this issue, according to the reports of Newspim.
Actions taken by major exchanges
Many exchanges started to take measures regarding this matter; two exchanges circulated warning on website, while Coin one has frozen LUNA’s trading on 11 May, and Binance postponed some mark trading. However, the official reports join the vast progressive story, there’s no connection between the investigation of Do Kwon and the officials’ request to cryptocurrency exchanges. The measures taken by the National assembly and South Korean officials clearly show that South Korea is going to take crucial actions to eliminate the Terra ecosystem.