According to the South Korea Local newspaper, NEWSPIM, South Korean lawmakers requested that Terra founder Do Kwon and exchange personnel be brought to Congress for a hearing to explain the reasons for Luna and UST’s sudden plunge and communicate measures to protect investors.
While the Luna-Terra coin, which was known as a stable coin and had a market cap of $18 billion at one time, was reduced to a piece of tissue paper overnight.
At a plenary meeting of the National Assembly’s Political Affairs Committee on the 17th, Representative Yoon Chang-Hyeon, from the People’s Power, said,
“There is a part that raises questions about the behavior of exchanges during the crash.” “Coinone, Korbit, and Gopax stopped trading on May 10, Bithumb on May 11 stopped trading daily, but Upbit did not stop trading until May 13,” he pointed out.
He continued, “As the legislation is delayed, investors’ losses are increasing. The authorities continue to see the huge loss of investors and are helpless to protect investors”
Rep. Yoon urged, “We should bring related exchange officials, including Terra CEO Do Kwon to the National Assembly to hold a hearing on the cause of the situation and measures to protect investors.”
More than 200,000 South Korean investors mourned losses as a result of the LUNA and UST crashes. Such losses made Terra Founder Do Kwon seek Police protection following the recent home Invasion from an alleged LUNA investor
The country’s Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) have asked crypto exchanges to provide data regarding the total number of holders of LUNA and UST, their trading volumes, and history of transactions.
The exchanges must provide their assessments of what happened, along with measures to protect users’ interests in the future.
Terra’s Revival Strategy
Today, in a Twitter thread, Kwon proposed that the Terra chain be forked, seeing the ecosystem has two chains – Terra Classic (LUNAC) and Terra (LUNA). The Terra Classic chain is the existing and current network, while the Terra will be the new chain.
While both chains will coexist, Kwon noted that the old tokens will be renamed LUNAC while the new ones will be called LUNA.
The launch of the new chain will require Terra developers to airdrop new LUNA tokens to holders of the old LUNA (LUNAC) and UST, as well as developers once the plan is implemented, Kwon said.
LFG Sinks 80K BTC
The Luna Foundation Guard (LFG) claims it sunk 80 thousand Bitcoins (BTC) in desperate efforts to save its TerraUSD (UST). Consequently, LFG’s BTC reserves have whittled down to 313 coins.
The foundation provided an explanation following an uproar from its customers on how it handled the debacle. In a series of tweets, LFG showed how it allocated funds from its reserve to shore up the sinking UST.
LFG began by revealing its assets in its reserve as of 7th May. It disclosed that it held 80,394 BTC, 39 914 BNB, and about 26.3M USDT. Additionally, it had nearly 23.6M USDC and 1.97M AVAX. Some 697K UST and roughly 1.7M LUNA were top-up in that reserve.
The foundation says it started converting its reserve assets to UST when crypto started dipping below a dollar. It says it traded some 50K BTC with a counterparty on May 8th. Again, they sold some additional 30K BTC in the last gasp effort to secure the peg.
Last week the $40B Terra Ecosystem crashed following UST dropping from a dollar to below 20 cents. Further, its LUNA token that’s designed to absorb shocks nosedive from $80 to under two cents.
Now Terra’s founder has to explain the situation in front of the South Korean congress members, providing details on how such a massacre happened.
