South Korean metaverses are closing amid scandals and disinterest

South Korea’s tech-savvy population, blazing-fast internet, and deep-rooted gaming culture made it the ideal testbed for metaverse applications. Despite these advantages, some of the country’s top metaverse platforms are now closing their doors.

The latest casualty is 2nd Block, a metaverse built by Dunamu, the operator of South Korea’s largest cryptocurrency exchange Upbit.

Dunamu announced that it will be shutting down its metaverse services on Sept. 9 due to weak engagement since the pandemic began to wane.

This comes on the heels of a similar move by Seoul’s metropolitan government. Last month, the city said its metaverse project, which cost $4.5 million to build, will be locking its virtual doors on Oct. 16. The digital version of Seoul, designed to offer residents and tourists a digital space to interact and explore, lasted less than two years.

Even the surviving metaverses are battling their issues.

Zepeto, a metaverse developed by South Korean internet giant Naver, has managed to thrive by shifting its focus to the global market. As of last year, it had 20 million monthly visitors from overseas and just 1.2 million local users, according to data analytics firm Sensor Tower.

At home, the platform has come under fire after several parents reported that their children’s avatars were sexually harassed by other users.

In severe cases, predators reportedly coerced minors into sharing explicit images in exchange for in-game items.

In response to these incidents, South Korean lawmakers proposed amendments to existing laws to prison times and fines on virtual sex offenders.

However, the draft bill ultimately failed to pass the National Assembly, leaving the issue unresolved.

Most complaints are left unsolved due to difficulties in tracking predators in digital spaces that span across international borders.

3AC liquidators sue Terra for $1.3 Billion over Terra collapse

Liquidators of the defunct Singapore crypto hedge fund Three Arrows Capital (3AC) have filed a $1.3 billion lawsuit against Terraform Labs.

In their court filing, 3AC liquidators Russell Crumpler and Christopher Farmer of Teneo Holding allege that Terraform Labs misled 3AC about the stability of its algorithmic stablecoin TerraUSD (UST) and its sister token LUNA, prompting the hedge fund to make substantial bets on the assets.

The liquidators are seeking damages not only for the direct purchases of UST and LUNA but also for the subsequent losses to 3AC’s crypto investments caused by Terra’s collapse.