South Korean Crypto Exchange Mistakenly Distributes Over $40bn in Bitcoin
A major South Korean cryptocurrency exchange has admitted to accidentally transferring more than $40bn worth of bitcoin to customers after a technical error turned a routine reward into a massive payout.
The platform, Bithumb, said it intended to credit users with a modest promotional bonus of 2,000 won, equivalent to about $1.37. Instead, a system malfunction on Friday resulted in the distribution of 2,000 bitcoins to hundreds of accounts, briefly making some users instant multimillionaires.
In a statement, Bithumb apologised for the incident, noting that the error was detected quickly. The exchange said it froze trading and withdrawals for the 695 affected accounts within 35 minutes of identifying the problem and was able to retrieve almost all of the digital assets.
According to the company, 620,000 bitcoins were mistakenly sent out, but 99.7 per cent of the tokens have since been recovered. Bithumb stressed that the incident was not the result of hacking or a security breach.
“This situation was caused by an internal processing error, not by any external attack,” the exchange said, adding that customer assets and system security were not compromised.
South Korea’s financial watchdog, the Financial Supervisory Service (FSS), convened an emergency meeting on Saturday to review the case. The regulator said it would open a formal investigation if there were signs of unlawful activity linked to the transfers.
Bithumb’s chief executive, Lee Jae-won, said the company would fully cooperate with regulators and use the incident as an opportunity to strengthen internal controls. He added that restoring customer confidence would take priority over expansion plans.
As part of its response, the exchange announced it would compensate all users active on the platform at the time with 20,000 won (about $13.66) and temporarily waive trading fees. It also pledged to enhance verification processes and deploy artificial intelligence tools to flag unusual transactions.
The episode is expected to reignite debates over tighter oversight in the financial and digital asset sectors. It follows other high-profile errors in recent years, including a 2024 case in which US banking giant Citigroup mistakenly credited a customer with trillions of dollars before reversing the transaction hours later.
