Terra Fiasco Propels South Korea To Launch A New Crypto Oversight Committee

Terra's LUNA and UST's meteoric collapse has many ramifications in the cryptocurrency industry, including a much stricter policy and more tedious supervision, particularly in South Korea, where an oversight committee set to launch in July was created to do precisely that.

The worldwide ruckus Terra created hastened the process of creating the Digital Asset Committee in South Korea -- an oversight team tasked to supervise and control digital assets in the country. Terraform Labs has a couple of headquarters in South Korea, specifically in Busan and Seoul and days before the infamous crash, Do Kwon, the South Korean CEO and founder of TFL, dissolved and liquidated these headquarters in the country.

The said committee will serve as overseers for the country's cryptocurrency industry until the proposed Digital Asset Basic Act is enacted and the government creates an agency that will handle the task. Currently, South Korea is reorganizing and expanding the Special Committee on Virtual Assets to create the new Digital Asset Committee, local news outlet NewsPim reported.

Among the functions of the new committee include creating coin-listing criteria, overseeing investor protection and monitoring unfair trade practices, to name a few. There is no specific launch date for the said watchdog yet, but it will be launched after the new chairman of the Financial Services Commission takes office.

"The party decided to launch the Digital Assets Committee hastily as the need for a reliable control tower to represent the virtual asset industry increased due to the Luna-Tera crash. It is expected to minimize market confusion and enhance policy effectiveness by unifying the system of the departments currently in charge of the Ministry of Strategy and Finance, the Financial Services Commission, the Ministry of Science and ICT, and the Personal Information Protection Committee," the translated version of the article read.

Following Terra's collapse, the South Korean government quickly jumped into action and came up with several ways to get to the bottom of the tragic incident that cost a lot of investors billions of money. Terraform Labs launched a new Terra blockchain and rolled out its native token LUNA 2.0 on May 28.

LUNA 2.0 was trading down 8.40 percent at $6.84 with a 24-hour volume of $818,878,619 as of 3:42 a.m. ET on Thursday, based on the data from CoinMarketCap.