South Korean cryptocurrency exchange Bithumb announced Saturday that it has recovered nearly all of the 620,000 Bitcoin mistakenly sent to users, an error which briefly impacted the Bitcoin price. This incident highlights the risks associated with cryptocurrency transactions and the importance of secure exchange operations.
According to Bithumb, the exchange mistakenly sent 620,000 Bitcoin to 249 users participating in a promotional event around 7 p.m. on Friday. This amounted to an average of 2,490 Bitcoin per user, valued at approximately 244 billion won ($166 million USD).
Immediately upon discovering the error, the crypto exchange halted transactions and withdrawals from the affected users’ accounts at 7:40 p.m.
Bithumb reported an immediate recovery of 618,212 Bitcoin and successfully recouped 93 percent of the 1,788 Bitcoin sold by users.
However, the exchange was unable to recover approximately 125 Bitcoin.
The incident occurred because a Bithumb employee mistakenly entered “BTC” as the payment unit instead of “Korean won” when distributing rewards for the promotional event. This human error had significant consequences for both the exchange and its users.
This error caused a temporary dip in the Bitcoin price on the Bithumb exchange as some users quickly sold the erroneously received Bitcoin. The incident serves as a reminder of the volatility and potential price swings in the cryptocurrency market.
The company estimates customer losses due to the erroneous payment to be around 1 billion won (approximately $760,000 USD). Bithumb is working to mitigate the impact on its users.
Bithumb has acknowledged instances where users sold Bitcoin under unfavorable market conditions due to the error. The exchange plans to compensate affected customers who panic-sold by covering the full price difference, plus an additional 10 percent bonus. This commitment demonstrates Bithumb’s effort to restore trust and maintain customer satisfaction.
CEO Lee Jae-won issued an apology and pledged to “take full responsibility” for the incident. Bithumb is reviewing its internal processes to prevent similar errors in the future.
The South Korean financial watchdog has dispatched staff to investigate the Bithumb incident. Increased regulatory scrutiny of cryptocurrency exchanges is expected following this event. This is a developing story and further updates will be provided as they become available.
