Yun Chang-hyun, a South Korean lawmaker, on Tuesday proposed that the founder of Terraform Labs, Do Kwon, be summoned before the country’s National Assembly for a hearing.
Local media outlet, Newspim, reports that Yun, a right-wing legislator from South Korea’s ruling party, proposed the idea during the legislative body’s session.
The lawmaker’s proposal follows the crash of LUNA and the TerraUSD (UST), the Terra blockchain’s cryptocurrency token and algorithmic stablecoin
Stablecoin
Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including gold, silver, or others. Advantages of StablecoinsOf note, stablecoins redeemable in currency, commodities, or fiat money are also said to be backed, whereas those tied to an algorithm are not considered to be so.There are several advantages of asset backed crypto. First, these coins are stabilized by assets that fluctuate outside of the crypto space, that is. This can help mitigate the financial risk associated with these assets.For example, Bitcoin and altcoins are highly correlated, so that cryptocurrency holders cannot escape periodic price falls. Stablecoins control for this vulnerability, allowing for the diversification of risk in a portfolio.Stablecoins also possess a mechanism for redeeming the asset backing them. This grants an additional level of confidence associated with the coin and are unlikely to drop below the value of the underlying physical asset, due to the effects such as arbitrage.For example, fiat-pegged coins are coins that are tied to a specified amount of fiat currency, usually on a one-to-one ratio (i.e.1 StablecoinX = $1). The companies that issue these currencies must have fiat reserves in the equivalent amount of the stablecoins they have issued.Crypto-pegged stablecoins constitute coins that are tied to a specified amount of another cryptocurrency, such as Bitcoin or Ethereum. Algorithmic stablecoins use supply-and-demand to automatically maintain a stable value.
Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including gold, silver, or others. Advantages of StablecoinsOf note, stablecoins redeemable in currency, commodities, or fiat money are also said to be backed, whereas those tied to an algorithm are not considered to be so.There are several advantages of asset backed crypto. First, these coins are stabilized by assets that fluctuate outside of the crypto space, that is. This can help mitigate the financial risk associated with these assets.For example, Bitcoin and altcoins are highly correlated, so that cryptocurrency holders cannot escape periodic price falls. Stablecoins control for this vulnerability, allowing for the diversification of risk in a portfolio.Stablecoins also possess a mechanism for redeeming the asset backing them. This grants an additional level of confidence associated with the coin and are unlikely to drop below the value of the underlying physical asset, due to the effects such as arbitrage.For example, fiat-pegged coins are coins that are tied to a specified amount of fiat currency, usually on a one-to-one ratio (i.e.1 StablecoinX = $1). The companies that issue these currencies must have fiat reserves in the equivalent amount of the stablecoins they have issued.Crypto-pegged stablecoins constitute coins that are tied to a specified amount of another cryptocurrency, such as Bitcoin or Ethereum. Algorithmic stablecoins use supply-and-demand to automatically maintain a stable value.
Read this Term, respectively.
“We should bring related exchange officials, including CEO Kwon Do-hyung of Luna, which has become a recent problem, to the National Assembly to hold a hearing on the cause of the situation and measures to protect investors,” Yun said during the session.
Yun also raised concern about the differing responses of cryptocurrency exchanges in the Asian country to the crash which shook crypto communities around the world.
“There is a part that raises questions about the behaviour 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,” the lawmaker pointed out.
Emphasizing on the importance of the proposed hearing, Yun said investors were losing money. He added that the legislative body should not delay its action.
The Historic Crash
Terra’s LUNA crashed more than 90% last week, dropping to almost $1 after the UST stablecoin lost its 1:1 peg to the United States dollar, plummeting to as low as $0.29.
The fall is said to be one of the biggest crypto crash for a major cryptocurrency, with many investors losing huge sums of money.
For example, Binance, the world’s largest cryptocurrency exchange by volume, had about 15 million LUNA tokens worth $1.6 billion at LUNA’s peak price in April. The exchange purchased the token in 2018 for $3 million. Following the crash, the investment is now worth less than $3000.
2/ Binance received 15,000,000 LUNA (at peak worth $1.6 billion USD, now not much) as part of the original ($3m) invest. 560x return at peak. It still sits on the address we received at ?. Never moved or sold.
Address:https://t.co/6HwTu6CCuB
— CZ ? Binance (@cz_binance) May 16, 2022
Kwon’s attempt to save the UST by selling $3 billion worth of Bitcoin through the Luna Foundation Guard did not redeem the controversial stablecoin.
Meanwhile, yesterday, the Terra creator proposed a hard fork
Fork
A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software that can result in the formation of a new blockchain, and a new cryptocurrency to go with it.Soft and Hard ForksA soft fork is a software upgrade that is compatible with previous versions of a blockchain network’s software. In other words, even if a miner doesn’t agree to install the upgrade, that miner’s software can still interact with the network. However, if the majority of miners on a network install the upgrade, there will come a point at which transactions confirmed by miners operating on the old version of the software will be made stale.A hard fork is a permanent divulgence from a blockchain. In other words, it occurs when a new set of consensus rules that are not compatible with the old rules is introduced onto a blockchain network. All participants on a network are required to upgrade onto the new version of the software in order to continue confirmation transactions. If there is enough support for the old version of a blockchain affected by a hard fork, then the two versions of the blockchains will operate independently of one another with two different cryptocurrencies. Two famous examples of this are the split between Ethereum and Ethereum Classic, and Bitcoin and Bitcoin Cash.
A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software that can result in the formation of a new blockchain, and a new cryptocurrency to go with it.Soft and Hard ForksA soft fork is a software upgrade that is compatible with previous versions of a blockchain network’s software. In other words, even if a miner doesn’t agree to install the upgrade, that miner’s software can still interact with the network. However, if the majority of miners on a network install the upgrade, there will come a point at which transactions confirmed by miners operating on the old version of the software will be made stale.A hard fork is a permanent divulgence from a blockchain. In other words, it occurs when a new set of consensus rules that are not compatible with the old rules is introduced onto a blockchain network. All participants on a network are required to upgrade onto the new version of the software in order to continue confirmation transactions. If there is enough support for the old version of a blockchain affected by a hard fork, then the two versions of the blockchains will operate independently of one another with two different cryptocurrencies. Two famous examples of this are the split between Ethereum and Ethereum Classic, and Bitcoin and Bitcoin Cash.
Read this Term to the Terra blockchain. Kwon suggested that the old chain be called Terra Classic (LUNC) with its token re-labelled as Luna Classic or $LUNC.
On the other hand, he submitted that the new blockchain could be called “Terra” with a token Luna or $LUNA and without algorithmic stablecoins.
Yun Chang-hyun, a South Korean lawmaker, on Tuesday proposed that the founder of Terraform Labs, Do Kwon, be summoned before the country’s National Assembly for a hearing.
Local media outlet, Newspim, reports that Yun, a right-wing legislator from South Korea’s ruling party, proposed the idea during the legislative body’s session.
The lawmaker’s proposal follows the crash of LUNA and the TerraUSD (UST), the Terra blockchain’s cryptocurrency token and algorithmic stablecoin
Stablecoin
Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including gold, silver, or others. Advantages of StablecoinsOf note, stablecoins redeemable in currency, commodities, or fiat money are also said to be backed, whereas those tied to an algorithm are not considered to be so.There are several advantages of asset backed crypto. First, these coins are stabilized by assets that fluctuate outside of the crypto space, that is. This can help mitigate the financial risk associated with these assets.For example, Bitcoin and altcoins are highly correlated, so that cryptocurrency holders cannot escape periodic price falls. Stablecoins control for this vulnerability, allowing for the diversification of risk in a portfolio.Stablecoins also possess a mechanism for redeeming the asset backing them. This grants an additional level of confidence associated with the coin and are unlikely to drop below the value of the underlying physical asset, due to the effects such as arbitrage.For example, fiat-pegged coins are coins that are tied to a specified amount of fiat currency, usually on a one-to-one ratio (i.e.1 StablecoinX = $1). The companies that issue these currencies must have fiat reserves in the equivalent amount of the stablecoins they have issued.Crypto-pegged stablecoins constitute coins that are tied to a specified amount of another cryptocurrency, such as Bitcoin or Ethereum. Algorithmic stablecoins use supply-and-demand to automatically maintain a stable value.
Unlike other cryptocurrencies like Bitcoin and Ethereum, stablecoins are cryptocurrencies that have been designed to keep a stable value. Placing a greater emphasis on stability over volatility can be a huge draw for some investors. Many individuals can be turned off from large swings and uncertainty presented by cryptos relative to other traditional assets.Stablecoins control for this volatility by being pegged to another cryptocurrency, fiat money, or to exchange-traded commodities, including gold, silver, or others. Advantages of StablecoinsOf note, stablecoins redeemable in currency, commodities, or fiat money are also said to be backed, whereas those tied to an algorithm are not considered to be so.There are several advantages of asset backed crypto. First, these coins are stabilized by assets that fluctuate outside of the crypto space, that is. This can help mitigate the financial risk associated with these assets.For example, Bitcoin and altcoins are highly correlated, so that cryptocurrency holders cannot escape periodic price falls. Stablecoins control for this vulnerability, allowing for the diversification of risk in a portfolio.Stablecoins also possess a mechanism for redeeming the asset backing them. This grants an additional level of confidence associated with the coin and are unlikely to drop below the value of the underlying physical asset, due to the effects such as arbitrage.For example, fiat-pegged coins are coins that are tied to a specified amount of fiat currency, usually on a one-to-one ratio (i.e.1 StablecoinX = $1). The companies that issue these currencies must have fiat reserves in the equivalent amount of the stablecoins they have issued.Crypto-pegged stablecoins constitute coins that are tied to a specified amount of another cryptocurrency, such as Bitcoin or Ethereum. Algorithmic stablecoins use supply-and-demand to automatically maintain a stable value.
Read this Term, respectively.
“We should bring related exchange officials, including CEO Kwon Do-hyung of Luna, which has become a recent problem, to the National Assembly to hold a hearing on the cause of the situation and measures to protect investors,” Yun said during the session.
Yun also raised concern about the differing responses of cryptocurrency exchanges in the Asian country to the crash which shook crypto communities around the world.
“There is a part that raises questions about the behaviour 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,” the lawmaker pointed out.
Emphasizing on the importance of the proposed hearing, Yun said investors were losing money. He added that the legislative body should not delay its action.
The Historic Crash
Terra’s LUNA crashed more than 90% last week, dropping to almost $1 after the UST stablecoin lost its 1:1 peg to the United States dollar, plummeting to as low as $0.29.
The fall is said to be one of the biggest crypto crash for a major cryptocurrency, with many investors losing huge sums of money.
For example, Binance, the world’s largest cryptocurrency exchange by volume, had about 15 million LUNA tokens worth $1.6 billion at LUNA’s peak price in April. The exchange purchased the token in 2018 for $3 million. Following the crash, the investment is now worth less than $3000.
2/ Binance received 15,000,000 LUNA (at peak worth $1.6 billion USD, now not much) as part of the original ($3m) invest. 560x return at peak. It still sits on the address we received at ?. Never moved or sold.
Address:https://t.co/6HwTu6CCuB
— CZ ? Binance (@cz_binance) May 16, 2022
Kwon’s attempt to save the UST by selling $3 billion worth of Bitcoin through the Luna Foundation Guard did not redeem the controversial stablecoin.
Meanwhile, yesterday, the Terra creator proposed a hard fork
Fork
A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software that can result in the formation of a new blockchain, and a new cryptocurrency to go with it.Soft and Hard ForksA soft fork is a software upgrade that is compatible with previous versions of a blockchain network’s software. In other words, even if a miner doesn’t agree to install the upgrade, that miner’s software can still interact with the network. However, if the majority of miners on a network install the upgrade, there will come a point at which transactions confirmed by miners operating on the old version of the software will be made stale.A hard fork is a permanent divulgence from a blockchain. In other words, it occurs when a new set of consensus rules that are not compatible with the old rules is introduced onto a blockchain network. All participants on a network are required to upgrade onto the new version of the software in order to continue confirmation transactions. If there is enough support for the old version of a blockchain affected by a hard fork, then the two versions of the blockchains will operate independently of one another with two different cryptocurrencies. Two famous examples of this are the split between Ethereum and Ethereum Classic, and Bitcoin and Bitcoin Cash.
A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software that can result in the formation of a new blockchain, and a new cryptocurrency to go with it.Soft and Hard ForksA soft fork is a software upgrade that is compatible with previous versions of a blockchain network’s software. In other words, even if a miner doesn’t agree to install the upgrade, that miner’s software can still interact with the network. However, if the majority of miners on a network install the upgrade, there will come a point at which transactions confirmed by miners operating on the old version of the software will be made stale.A hard fork is a permanent divulgence from a blockchain. In other words, it occurs when a new set of consensus rules that are not compatible with the old rules is introduced onto a blockchain network. All participants on a network are required to upgrade onto the new version of the software in order to continue confirmation transactions. If there is enough support for the old version of a blockchain affected by a hard fork, then the two versions of the blockchains will operate independently of one another with two different cryptocurrencies. Two famous examples of this are the split between Ethereum and Ethereum Classic, and Bitcoin and Bitcoin Cash.
Read this Term to the Terra blockchain. Kwon suggested that the old chain be called Terra Classic (LUNC) with its token re-labelled as Luna Classic or $LUNC.
On the other hand, he submitted that the new blockchain could be called “Terra” with a token Luna or $LUNA and without algorithmic stablecoins.
Source: https://www.financemagnates.com/cryptocurrency/south-korean-legislator-calls-for-do-kwon-to-appear-before-national-assembly/
