Domestic Cryptocurrency Exchanges Earn Over 10 Billion KRW in Fees Amid Luna-Terra Incident

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The four major domestic virtual asset exchanges have been confirmed to have earned over 10 billion KRW in fees from the Luna-Terra incident.

The Luna-Terra incident refers to the event in May when the stablecoin Terra, classified as a Korean coin in the cryptocurrency industry, and its sister coin Luna plummeted consecutively, shaking the cryptocurrency market.

Terra was designed to be pegged at a value of 1 dollar per coin, and Luna was issued to support the value of Terra, which is used in DeFi (decentralized finance) and other applications. However, as Terra recently fell below 1 dollar, Luna also crashed, causing great chaos in the cryptocurrency market.

According to data submitted on the 2nd by the Digital Asset Exchange Joint Council to Representative Yoon Young-duk of the Democratic Party, the fees earned by Upbit, Bithumb, Korbit, and Coinone during the Luna-Terra incident were approximately 6.27 billion KRW for Upbit, 1.95 billion KRW for Bithumb, 370 million KRW for Coinone, and 17 million KRW for Korbit.

However, the Upbit fee of approximately 6.27 billion KRW is based on Bitcoin (BTC) prices as of September 21, and if BTC prices as of May 20, when Luna trading support ended, are applied, the amount reaches 9 billion KRW.

Thus, the total fees earned by domestic virtual asset exchanges at that time exceeded 10 billion KRW.

Immediately after the incident, on May 31, Upbit decided to use all fees generated from the Luna-Terra incident to support investors. Subsequently, on the 30th of last month, Upbit announced plans to donate to public interest organizations and establish a digital asset market monitoring center.

Representative Yoon Young-duk pointed out that Upbit’s response came a full four months after the incident and was announced just before the National Assembly’s Political Affairs Committee audit.

Bithumb is considering measures to protect investors, and Coinone responded that it will use the related fee income for long-term investor protection, such as preventing security incidents.

Korbit stated that it plans to donate all related fee income this year to legal aid projects supporting victims of virtual asset investment damages.

Representative Yoon said, "Even when Terra-Luna crashed 99.9% from its peak within a week, causing astronomical damages, virtual asset exchanges were still earning fee revenues," adding, "It is quite coincidental that they announced how to return fee revenues only now, four months later, just before the audit."