In brief
In a significant operational error, Bithumb, a South Korean cryptocurrency exchange, mistakenly distributed over $40 billion in Bitcoin to customers, intending to offer a small reward instead. Nearly all incorrect transactions were reversed shortly after the incident. Authorities and the company are now examining the implications for regulatory policies in the cryptocurrency sector.
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 gave them 2,000 bitcoins on Friday.
The platform, Bithumb, apologized for the error, adding that it quickly realized its mistake and recovered almost all the missing tokens.
It said it had restricted trading and withdrawals for the 695 affected customers within 35 minutes of the glitch.
The company reported that it had recovered 99.7% of the 620,000 bitcoins mistakenly sent.
We want to make it clear that this matter has nothing to do with external hacking or security breaches, and there is no problem with system security or customer asset management, Bithumb said in a statement.
In an emergency meeting on Saturday, South Korea's financial regulator stated it would look into the incident, warning that any sign of illegal activity would prompt formal investigations by the Financial Supervisory Service (FSS).
Bithumb's CEO, Lee Jae-won, assured that the company would cooperate with regulators and take this incident as a lesson to prioritize customer trust and asset management.
The exchange plans to compensate all customers who were using the platform during the incident with 20,000 won ($13.66) and will waive trading fees. Additionally, Bithumb aims to enhance its verification systems and implement AI to detect abnormal transactions.
Experts anticipate that the incident could trigger discussions about tighter regulatory controls within the financial sector.
Comparably, in April 2024, Citigroup mistakenly credited $81 trillion instead of $280 to a customer's account due to human error. The mistake was caught and reversed within hours.
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