South Korea's Justice Minister Han Dong-hoon paid a visit to officials from the United States to offer their cooperation in the investigations on Terra's collapse, including other issues on financial crimes.
U.S., South Korean Officials Meet to Discuss Information Sharing on Crypto and Fraud Investigations
The meeting went between Dong-hoon and Chief Andrea M. Griswold of the U.S. Securities and Commodities Task Force. Also in attendance in an earlier meeting was the chief of the U.S. Securities and Commodities Fraud Task Force, Scott Hartman. The objective of the meeting was to formalize an agreement between the two interested countries on sharing information and strengthening cooperation in investigations surrounding major securities fraud and financial crimes. The inter-state partnership will be between the Seoul Southern District Prosecutors Office and the Southern District of New York.
Specifically stated in their discussions are two-way obligations in exchanging on-hand data about investigations on high-profile cryptocurrency market issues, including the collapse of TerraUSD and the whole Luna ecosystem. This particular issue has been covered widely in news reports because its implosion cratered the crypto market.
As many may recall, Terra recorded a 98% crash within 24 hours which leveled $40 billion worth of assets within the protocol. It shook the whole crypto community, more so for those who were invested in the platform and those who deposited their life savings but did not expect something like that to happen. This crash, the cracks exposed in the crypto market, and the likelihood for more Terra-like implosions in the future have attracted more eyeballs from government regulatory agencies. Many experts have already expected this level of legal scrutiny, however. Cardano ($ADA) founder, Charles Hoskinson, has said something to this effect as a comment on the astronomical rise of memecoins like Dogecoin ($DOGE).
Crypto Communities Can Expect Tighter Crypto Measures Ahead
The U.S. recently launched an investigation on Terra and its founder, Do Kwon, because of the collapse. South Korea has been pursuing its own investigation as well, looking for pieces of evidence that could support allegations of fraud, tax evasion, and market manipulation. The partnership between the two countries is expected to flourish and inspire more partnerships in the future since both of them have been focusing more on crypto-related crimes. South Korea has emerged as one of the most stringent countries regarding cryptocurrency legislation, enforcing severe Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements.
The Terra scandal has also pushed Korean politicians to establish a new crypto oversight body to evaluate new crypto projects listed on cryptocurrency exchanges. Many analysts expected that the TerraUSD Classic (USTC) meltdown would lead authorities to choose centralized stablecoins over algorithmic ones. Tracking and prosecuting these crimes, which frequently include cross-border transactions and laundering, is becoming increasingly difficult and complex due to a lack of defined crypto legislation. In 2019, for example, a Dutch institution paid 200,000 in Bitcoin (BTC) as a ransom. The detectives tracked one wallet to Ukraine and had to work with local officials to recover the money nearly three years after the attack.
