(Bloomberg) -- South Korean policymakers are pushing the country’s cryptocurrency exchanges to come up with industry guidelines for listing and delisting digital tokens, in a bid to protect the public after the collapse of the TerraUSD stablecoin.

Yun Chang-hyun, a lawmaker who heads the ruling party’s virtual assets committee, has called a second meeting with bourses Upbit, Bithumb, Coinone, Korbit and Gopax for next week, he said in an interview. The aim is to agree on a draft of the non-binding guidelines, he said. The country would employ a self-regulatory system, like Japan does. 

“There are a lot of shortcomings compared with traditional finance,” Yun said by phone. Crypto “was neglected for too long without order and discipline.”

The move comes after the high-profile implosion of algorithmic stablecoin TerraUSD last month. Around $40 billion in market value was erased globally for holders of TerraUSD and its sister coin Luna when TerraUSD plunged far below its $1 peg. An estimated 280,000 South Koreans had invested in Luna, according to the Financial Services Commission, the country’s financial regulator.

Do Kwon and Daniel Shin, the co-founders of Terraform Labs, the company behind the two cryptocurrencies, were both born in South Korea. Terraform Labs was founded in 2018, according to its LinkedIn page. 

Global Push

South Korea joins governments around the world in pushing for more crypto oversight in the wake of the TerraUSD collapse. Much of the recent efforts have centered on ensuring that investors in stablecoins, a vital part of the cryptocurrency ecosystem, are better protected. 

Such tokens, which are typically pegged to an asset like the US dollar, have a combined market value of about $160 billion, according to CoinGecko. Yun said the TerraUSD failure underscores the need for better investor protections in crypto. 

Yun didn’t elaborate on the details of the draft guidelines. They’re likely to include stricter reporting requirements to provide transparency rather than a tightening of trading procedures, according to people familiar with the matter, who asked not to be identified discussing private information. 

Representatives for four of the five exchanges -- which together account for almost 99% of cryptocurrency trading in South Korea -- confirmed the meeting but said they weren’t aware of its agenda. The FSC said it knows about the gathering but was unable to comment on the plan. The exchanges would make the announcement if any guidelines were established, it said.

The ruling party held a first meeting with the five exchanges on May 24. 

Apart from the planned self-regulatory guidelines, the Korea Blockchain Association, an industry body, has been drawing up a draft manual on behalf of its 19 members setting out comprehensive guidelines for how to operate, said Yun Sung Han, its director. The association’s members include the five crypto exchanges, he said.

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