Fall of Terra (LUNA) network has brought skepticism not just among investors; rather crypto exchanges are also facing the same and making efforts for its prevention.
Among the numerous efforts made in the wake of preventing the potential collapse like the Terra (LUNA) network, another one added from Korean leading exchanges. It came into account that recently top cryptocurrency exchanges in Korea have mutually decided and agreed for forming a new emergency system. This emergency system is said to be triggered and come into action in less than 24 hours anticipating any collapse like Terra network is to come.
The new emergency system all those leading participant exchanges will respond unitedly in any adverse situation that could impact the market as Terra (LUNA) collapse did in May. The participants for the agreement include the largest cryptocurrency exchanges of Korea including Upbit, Bithum, Korbit, Gopax and Coinone. These leading crypto exchanges have attended a session on Monday. The session was at the South Korean legislature, National Assembly in order to address the fairness inside the market.
The discussion went on among members of the National Assembly, chairman of Financial Supervisory Services (FSS) Lee Bok-hyeon and aforementioned leading crypto exchanges. They discussed the aspects of the proposed new code of conduct that exchanges would need to follow willfully and will stick to it voluntarily with sole focus of protecting investors.
The rollout of a warning system is also included in the new code scheduled for September this year. This warning system would be used to signal the crypto investors of those virtual assets that fall under the unusually high risk category due to either abnormal changes in their price or other such unusual activities. It was also decided that there will be reviews of listing guidelines in October and there will be a regular evaluation system for all the listed tokens.
The fall of the Terra ecosystem last month resulted in loss of tens of billion dollars worth of investment and also brought legal complications for founder of Terra network, Do Kwon. Terra network founder has been confirmed and proven guilty of evading taxes worth $40 million through his company Terraform Labs.
As far as the new code is concerned, it would aim to make token listings and delistings more systematic that would help in maximizing regulatory compliance and also eliminate the disparity resides amongst the exchanges in terms of listing guidelines.
Source: https://www.thecoinrepublic.com/2022/06/17/whats-this-new-emergency-system-that-korean-exchanges-agreed-to-rely-upon-to-prevent-terra-like-collapse/