One of South Korea’s largest cryptocurrency exchanges, Bithumb, is attempting to recover from a monumental operational error that saw it accidentally distribute over $44 billion worth of Bitcoin to customers as part of a promotional event.
The incident occurred on Friday when the exchange, intending to give small cash rewards of about 2,000 Korean won ($1.40) to select users, mistakenly awarded at least 2,000 Bitcoins each to 695 customers instead. In total, approximately 620,000 Bitcoins were erroneously sent out.
Bithumb said in a statement it detected and halted the giveaway within 35 minutes, swiftly restricting trading and withdrawals for the affected accounts. The firm reported it has since recovered 99.7% of the misplaced assets. It emphasized the blunder was an internal human error, stating, “This incident is unrelated to external hacking or security breaches.”
The erroneous distribution triggered immediate volatility on the platform, with Bitcoin’s price on Bithumb plummeting roughly 17% before partially recovering.
South Korea’s financial regulators, including the Financial Services Commission, responded sharply, calling the event a stark revelation of “the vulnerabilities and risks of virtual assets.” They announced plans for potential on-site inspections of Bithumb and other exchanges if reviews uncover irregularities in their internal controls and asset management.
Bithumb, which trails the market-leading exchange Upbit in South Korea, has issued a public apology for the mistake and the resulting market disruption. The event is expected to intensify scrutiny of operational safeguards within the nation’s cryptocurrency industry.
