Impact Of Terra (LUNA) Drop, South Korean Parliament Summons Do Kwon

South Korea's parliament will summon Do Kwon. (photo: KoreaHerald)

JAKARTA – The fall in the price of Terra (LUNA) and stablecoin TerraUSD (UST) has been in the spotlight of the media around the world. The CEO of Terraform Labs, Do Kwon, is reportedly going to be summoned by the South Korean parliament for questioning regarding Terra's collapse that harmed investors.

According to Cointelegraph, local news reports that Korean exchanges responded differently to Terra's fall. The National Assembly Political Affairs Committee on Tuesday summoned Terraform Labs co-founder Do Kwon for questioning by parliament on the matter.

“There is a section that raises questions about the behavior of the exchange during the accident,” said Committee representative, Yoon Chang-Hyeon of People's Power.

“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 added.

"While the (crypto-related) legislation is pending, investor losses are increasing," Yoon said. He added "that authorities continue to see heavy losses on investors and are powerless to protect investors."

Therefore, Yoon urged the parliament to summon local crypto exchange officials and CEO Terra Do Kwon to find out the cause of the incident.

“We should bring the relevant exchange officials, including CEO Terra Do Kwon to the National Assembly to hold a hearing on the causes of the situation and measures to protect investors,” Yoon suggested.

The collapse occurred after the depegging of the UST algorithmic stablecoin which then led to a death spiral that dragged the main LUNA token down 100 percent. To overcome this problem, Kwong claims to be trying to restore the ecosystem from destruction.

Kwon recently proposed that the terra ecosystem fork or branch into two networks. Later there will be two tokens, namely the current token being Terra Classic (LUNAC) and the new branch being Terra (LUNA). However, the LUNAtics community rejected the proposal.