South Korean cryptocurrency exchange Bithumb accidentally credited hundreds of users with 2,000 Bitcoin each, worth approximately $142 million per person, instead of a $1.37 cash reward. The internal accounting error, which involved a total of 620,000 BTC valued around $43 billion, triggered a frantic sell-off and a flash crash of Bitcoin’s price on the platform to $55,000. The exchange corrected the mistake within five minutes and stated the incident was not related to any external hack or security breach.
A major South Korean crypto exchange mistakenly distributed billions in Bitcoin to users this week, causing a rapid price crash on its internal market. Bithumb erroneously sent 2,000 BTC, worth about $142 million each, to 695 users instead of a planned 2,000 won ($1.37) reward.
The error occurred during a “Random Box” giveaway, according to local reports. The deposits were recorded only on Bithumb’s internal ledgers and did not involve actual on-chain Bitcoin transfers.
The irregularity was detected and corrected within five minutes, the company stated in a blog post. Some users attempted to sell the phantom Bitcoin in that short window, with financial authorities estimating over $2 billion worth was sold.
This rapid sell-off plunged Bitcoin’s price on the exchange to $55,000, far below prices on other global platforms. “The Bitcoin price temporarily fluctuated sharply as some accounts that received the Bitcoin sold it,” Bithumb said.
The exchange clarified the incident was not a security breach and resulted in no loss of customer assets. “We want to make it clear that this incident is unrelated to any external hacking or security breach, and does not pose any issues with system security or customer asset management,” the company added.
On Saturday, Bithumb said it had recovered 618,212 BTC of the credited funds and clawed back 93% of the sold assets. The firm stated any unrecovered sold BTC would be adjusted using company assets.
“Bithumb takes this incident very seriously and will do its utmost to prevent recurrence by redesigning the entire asset payment process and enhancing the internal control system,” it added. The company pledged to ensure users can trust its services.
