Investigative agencies are collecting information on algorithm-based stablecoins following the recent collapse of Terraform Labs’ Luna and TerraUSD.
According to Yonhap News Agency citing unnamed sources on Tuesday, police are gathering relevant data in preparation for a possible investigation.
Stablecoins are a type of cryptocurrency designed to maintain a consistent value by coupling itself to a “peg,” usually a fiat currency, a commodity, another cryptocurrency or a financial instrument.
The police, who believe there are currently some seven other similar stablecoins in circulation, are considering applying charges of fraud and unauthorized fundraising against Terraform Labs, though there are limitations to bringing such charges against the creators of cryptocurrencies.
While the prosecution’s recently revived financial and securities crime investigation team is assumed to be taking the lead on a case should it materialize, the police on Monday reportedly began a probe into alleged embezzlement by an employee at Terraform Labs.
Source: KBS World Radio