In brief
Bithumb, a South Korean cryptocurrency platform, mistakenly allocated over $40 billion in Bitcoin to its customers by intending to distribute a mere cash reward of 2,000 won. The exchange quickly acted to restrict trading and recover the lost funds, with plans for compensation and improved security measures amidst potential regulatory scrutiny.
A South Korean cryptocurrency exchange accidentally gave away more than $40bn (£32bn) worth of bitcoin to customers, briefly making them multi-millionaires. It had planned to give customers a small cash reward of 2,000 won - $1.37 - but instead, they received 2,000 bitcoins on Friday. The platform, Bithumb, apologized for the error, adding that they quickly realized their mistake and managed to recover almost all the missing tokens. Within 35 minutes of the glitch, the exchange restricted trading and withdrawals for the 695 affected customers. Bithumb stated it had recovered 99.7% of the 620,000 bitcoins mistakenly sent and asserted that the issue had nothing to do with external hacking or security breaches. In an emergency meeting, South Korea's financial regulator announced it would investigate the incident. Any sign of illegal activity would prompt formal investigations by the Financial Supervisory Service (FSS). Bithumb's CEO, Lee Jae-won, expressed their commitment to cooperate with regulators, saying, [We] will take this accident as a lesson and prioritize 'customer trust and peace of mind' rather than external growth. The company plans to offer 20,000 won ($13.66) in compensation to all customers who were using the platform at the time and will waive trading fees, among other measures. The exchange intends to improve verification systems and introduce AI to detect abnormal transactions. This incident is likely to ignite discussions around tighter regulatory controls in the finance sector. A similar blunder occurred in April 2024 when Citigroup mistakenly credited a customer with $81 trillion, an error that was reversed within hours.
