Investor Sues Korean Cryptocurrency Exchange for Delaying Coin Transfer prior to Luna Crash
Dunamu Inc., the firm that operates the South Korean Cryptocurrency Exchange Upbit, has been sued by a man in his 50s, cryptocurrency investor, Korea Joongang Daily reported on Monday.
The investor stated that Upbit delayed processing his coin transfer off the exchange prior to the coin crashing, ensuing in a monetary loss of 156 million won ($112,477). Upbit is one of the largest Cryptocurrency Exchanges in South Korea.
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The lawsuit filed with the Seoul Central District Court last week mentions that the investor attempted to transfer 1,310 luna coins (LUNA) on March 24 from his Upbit Cryptocurrency wallet to a wallet he owns at Binance exchange in order to exchange the coins for Vietnamese dong. On that date, the price of LUNA, now called luna classic (LUNC), was around USD 92.79 per coin. It crashed to near zero in early May.
Binance Exchange notified the investor the following day that his coins had been reimbursed due to a problem with the transfer process. However, the coins were not showing up in his Upbit wallet either. After probing, Upbit told him that his coins had been inadvertently deposited in Upbit is own Cryptocurrency Wallet and that their return was held up by account verification procedures as mandated by law.
In South Korea, the Act on Reporting and Use of Certain Financial Transaction Information was edited to reflect the Financial Action Task Force (FATF) is Travel Rule. The amendment went into effect on 25th March, demanding virtual asset service providers (VASPs) in South Korea to authenticate sender and recipient information of cryptocurrency transactions.
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The investor is lawyer described that his client asked Upbit 27 times when his luna coins would be reimbursed to his wallet. Each time, the Upbit exchange told him that the coins return was being processed.
Dunamu told the publication that the firm is looking into the details of the lawsuit. However, Upbit is terms of service state that the firm is not responsible for any losses incurred by investors as a consequence of the Upbit Exchange adhering to laws and regulations.
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