Korea’s major crypto exchanges have agreed to develop a new emergency system that will activate within 24 hours if another Terra-style crash threatens to occur.
Exchanges will gather under the new method to respond to sudden unfavorable market consequences, such as what happened with Terra in May.
According to a source from local news outlet Daily Sports, the agreement came after five of the country’s top crypto exchanges, Upbit, Bithumb, Coinone, Korbit, and Gopax, attended a session at the National Assembly, South Korea’s legislature, on Monday to discuss market fairness.
Korea’s new system to tackle a Terra-style fall
Exchange officials, members of the National Assembly, and Chairman Lee Bok-Hyeon of the Financial Supervisory Services (FSS) addressed components of a new code of conduct that exchanges will voluntarily follow to protect investors.
In September, the new code will also see the launch of a warning system to alert investors of especially high-risk virtual assets due to extraordinary price changes or other unusual activities.
Listing standards will be revisited in October, and a regular evaluation system for all listed tokens will be implemented.
The collapse of the Terra ecosystem in May resulted in tens of billions of dollars in losses and a flurry of legal issues for Do Kwon, the company’s creator, who was confirmed to have cheated the government out of roughly $40 million in taxes.
Do Kwon, the South Korean founder and CEO of Terraform Labs, has been the center of attention for Korea’s exchanges. The notorious Financial and Securities Crime Investigation Team, often known as the Grim Reapers of Yeoui-do, has been investigating Kwon for alleged wrongdoing and tax evasion.
According to The JoongAng news outlet, the Grim Reapers unearthed records from the Seoul tax office on Wednesday, claiming and confirming that Kwon and Terraform Labs dodged roughly $40 million in corporation and income taxes in 2021.