The drastic collapse of TerraUSD and its sister token LUNA Classic (LUNA) has prompted South Korean politicians to call for rapid regulation of the cryptocurrency.
Call for a draft resolution
According to the new reportSenior officials have asked cryptocurrency exchanges to develop guidelines for listing and delisting digital tokens to protect investors from yet another debacle.
Yoon Chang-Hyun, an MP who chairs the ruling People’s Power Party’s virtual asset committee, has called for a second meeting with local cryptocurrency exchanges Upbit, Bithumb, Coinone, Korbit and Gopax next week.
The politician said in an interview that the main purpose of the meeting is to agree on the draft non-binding guidelines. South Korean politicians are seeking to implement a system of self-regulation similar to that of Japan.
The official also said that the cryptocurrency industry has been “neglected for too long without order and discipline,” while highlighting “disadvantages” compared to traditional finance.
Further details of the draft guidelines were not disclosed, but most of the effort is likely to focus on applying stricter reporting requirements to increase transparency instead of tightening trade procedures, according to Bloomberg sources familiar with the matter.
Representatives from four of the five South Korean cryptocurrency exchanges have so far confirmed the second meeting, but said they were unaware of its agenda. The FSC was also unable to comment on the agenda for the meeting, but said the crypto platforms would release official announcements if any guidelines were set.
Digital Assets Committee
Shortly after the massive explosion of the Terra ecosystem tokens, Chang-Hyun called a parliamentary hearing, which took place on May 24. He also asked five crypto exchanges to explain their behavior during the crash. According to data provided by the Financial Services Commission, the country’s financial regulator, about 280,000 South Koreans have invested in Luna.
As Terraform Labs employees are under investigation by the country’s authorities, the ruling party hopes to create a new digital asset committee to serve as a “control tower” for the sector to better protect stablecoin investors. The committee is scheduled to launch in the last week of June following the inauguration of a new financial chairman.
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Credit : cryptopotato.com