The UST collapse has sparked global regulatory concerns, with many countries beginning to pay attention to Crypto Assets regulation.

Recently, the collapse of the UST stablecoin has had a huge impact on the Crypto Assets market, and its effects have spread beyond the encryption field. This event has attracted the high attention of global regulatory agencies, and countries are once again focusing on the regulatory issues of the Crypto Assets market.

On May 8, the dollar-pegged algorithmic stablecoin UST on the Terra blockchain experienced a severe depegging phenomenon. The UST, which was originally valued at 1 dollar, dropped to 0.04 dollars in just 5 days, a decline of 97.7%. Meanwhile, the LUNA coin associated with the issuance of UST also suffered a catastrophic collapse, dropping to as low as 0.000001 dollars, effectively going to zero. Just a month ago, on April 5, the market price of LUNA was as high as 119 dollars.

The impact of this event spread rapidly, triggering urgent responses from regulatory agencies in multiple countries. On May 17, South Korea's Financial Services Commission (FSC) and Financial Supervisory Service (FSS) launched emergency inspections of domestic Crypto Assets exchanges. They requested exchanges to provide trading information related to UST and LUNA, including detailed data such as trading volume, closing prices, and transaction quantities.

The South Korean political circles are also paying high attention to this matter. Some lawmakers are calling for a National Assembly hearing on the risks of UST and have suggested inviting the CEO of Terra and executives from exchanges to discuss the reasons for the incident and measures for investor protection.

At the same time, regulators in regions such as the United States and Europe have also responded quickly. The Federal Reserve mentioned the issue of stablecoins in its latest Financial Stability Report, the U.S. Treasury has re-examined legislation regarding stablecoins, and the Securities and Exchange Commission (SEC) reiterated the principles of investor protection following the collapse of UST.

In Europe, the UK Treasury confirmed on May 10 that it will regulate stablecoins with the premise of supporting innovation, but will exclude algorithmic stablecoins. The President of the French Central Bank also revealed that the G7 will discuss the regulation of Crypto Assets at the upcoming meeting in Germany.

U.S. Treasury Secretary Janet Yellen directly mentioned the UST incident, emphasizing that Congress needs to consider imposing similar regulatory requirements on stablecoin issuers as those for banks. SEC Chairman Gary Gensler stated that he will continue to act as the "police" of the Crypto Assets market to protect investor interests.

The UK's regulatory stance on stablecoins is clearer. The UK Treasury has announced plans to advance stablecoin regulation, but only for "payment purpose stablecoins," excluding algorithmic stablecoins. They believe that algorithmic stablecoins lack the necessary stability and are unsuitable for payment purposes.

Overall, the UST crash event has become a wake-up call, prompting global regulatory agencies to re-examine the risks and regulatory needs of the Crypto Assets market. In the future, we may see more countries and regions introducing regulatory measures aimed at Crypto Assets, especially stablecoins, to protect investor interests and maintain the stability of financial markets.