South Korean law enforcement officials announced on Monday that they are taking legal action to freeze all assets linked to the non-profit group Luna Foundation Guard (LFG).
Korean police want to freeze Luna Foundation assets
According to the Seoul Metropolitan Police Agency, several cryptocurrency companies have already been brought in to block the funds or any other resources that may have ties to the LFG.
While the purpose of the block is unclear, in South Korea exchanges are not required by law to do so, which also means that it is not guaranteed whether these actions will be carried out or not.
Police said that after the collapse of UST/LUNA, which saw the value of the TerraUSD (UST) stablecoin drop below $0.10, some investors sued Terraform Labs founder Do Kwon and the police were called.
The authorities then launched an investigation that found clues indicating that people had embezzled funds from the LFG.
Still regarding the recent collapse of the Terra ecosystem, not only the police but also the South Korean lawmakers are taking action. They are meeting with representatives from five of South Korea’s biggest exchanges.
The meetings are taking place this Monday, and should last until Tuesday (24), according to the local portal Chosun Daily.
The companies in question are: Upbit, Bithumb, Coinone, Korbit and Gopax. According to the publication, the debates will resolve whether or not platform representatives should be held responsible for the loss of funds from token holders.
“We will request that a quality investor protection policy be implemented across exchanges,” Yoon Chang-hyeon, chairman of the People Power Party’s Virtual Assets Special Committee, said in a Facebook post.
Coinone was one of the exchanges that suspended trading on Luna, which is part of the Terra ecosystem, and was supposed to help UST keep its peg to the dollar.