Bithumb Bitcoin Error Triggers Alarming South Korean Probe Over 60 Trillion Won Payout

SEOUL, South Korea – Financial authorities have launched an urgent on-site investigation into cryptocurrency exchange Bithumb following a catastrophic Bitcoin payout error that temporarily exposed the platform to losses exceeding 60 trillion won. This unprecedented incident, which occurred on April 15, 2025, represents one of the most significant operational failures in cryptocurrency exchange history and has triggered immediate regulatory scrutiny in one of the world’s most active crypto markets.

Bithumb Bitcoin Error: Anatomy of a Multi-Trillion Won Mistake

South Korea’s Financial Intelligence Unit (FIU) and Financial Supervisory Service (FSS) dispatched investigators to Bithumb’s headquarters immediately after learning about the mispayment incident. According to official statements obtained by The Hankyoreh, authorities are treating this case with extreme seriousness due to both the enormous scale of potential damages and the systemic implications for cryptocurrency market stability. The investigation aims to determine whether the error resulted from human mistake, system vulnerability, or procedural failure.

The incident unfolded with startling simplicity yet staggering consequences. At approximately 10:00 a.m. UTC on April 15, a Bithumb employee attempted to distribute promotional event prizes ranging from 2,000 to 50,000 Korean won (approximately $1.50 to $38 USD) to 695 selected customers. However, during the transaction input process, the payment unit field was mistakenly set to Bitcoin (BTC) instead of Korean won. Consequently, each recipient received at least 2,000 BTC instead of the intended cash equivalent.

This administrative error translated to immediate financial exposure exceeding 60 trillion won based on Bitcoin’s market price at the time. To provide context, this amount surpasses:

The annual operating budget of South Korea’s Ministry of Science and ICT
The market capitalization of several mid-sized Korean corporations
Multiple previous cryptocurrency exchange losses combined

Immediate Market Impact and Exchange Response

The erroneous Bitcoin distribution triggered immediate and dramatic market consequences on Bithumb’s platform. As recipients discovered their unexpected windfall, many attempted to liquidate their positions, creating substantial selling pressure. Consequently, Bitcoin’s price on Bithumb plummeted significantly below global market rates, creating a substantial arbitrage opportunity and threatening price stability across the broader cryptocurrency ecosystem.

Bithumb’s risk management team detected the anomaly within minutes and implemented emergency protocols. The exchange immediately:

Blocked all trading activities for the affected 695 accounts
Suspended withdrawal capabilities for those accounts
Initiated communication with affected users to explain the error
Began the recovery process for misallocated funds

According to Bithumb’s official statement, the exchange successfully recovered 618,212 BTC, representing 99.7% of the erroneously distributed Bitcoin. This remarkably high recovery rate suggests most recipients cooperated with the exchange’s request to return the funds, though the exchange has not disclosed whether any legal action was required to facilitate returns.

Regulatory Context and Historical Precedents

This incident occurs against a backdrop of increasing regulatory scrutiny in South Korea’s cryptocurrency sector. Since implementing the Travel Rule in 2022 and enhancing exchange licensing requirements, South Korean authorities have maintained rigorous oversight of cryptocurrency platforms. The Financial Services Commission (FSC) has repeatedly emphasized the importance of operational integrity and consumer protection in the rapidly evolving digital asset space.

Historical precedents provide important context for understanding the regulatory response. In 2021, the FSC fined multiple exchanges for inadequate anti-money laundering controls. Furthermore, the 2022 collapse of Terraform Labs, founded by South Korean entrepreneur Do Kwon, intensified regulatory focus on cryptocurrency market stability and investor protection. The Bithumb incident represents a different category of risk – operational rather than financial or fraudulent – but one that regulators view as equally threatening to market integrity.

Comparative Cryptocurrency Exchange Incidents in South Korea
Year	Exchange	Incident Type	Scale	Regulatory Outcome
2018	Coinrail	Security Breach	$40M in losses	Enhanced security mandates
2021	Bithumb	AML violations	Multiple fines	Strengthened compliance requirements
2023	Multiple	Listing violations	Warnings issued	Tighter listing standards
2025	Bithumb	Operational error	60T won exposure	Ongoing investigation

Technical and Operational Implications

The Bithumb Bitcoin error raises significant questions about exchange operational safeguards. Industry experts note that most cryptocurrency exchanges implement multiple verification layers for large transactions, including:

Dual approval requirements for transfers exceeding specific thresholds
Automated alerts for unusual transaction patterns
Currency unit confirmation screens
Real-time monitoring of wallet movements

The fact that this error occurred despite these standard industry practices suggests either procedural breakdown or insufficient threshold settings. Particularly concerning is the apparent absence of a system flag when distributing Bitcoin amounts thousands of times larger than typical promotional rewards. This incident will likely prompt exchanges globally to review their internal controls and transaction verification processes.

Market analysts have identified several immediate consequences beyond the direct financial exposure:

Temporary fragmentation between Bithumb’s Bitcoin price and global benchmarks
Increased scrutiny of exchange operational resilience
Potential short-term volatility in Korean cryptocurrency markets
Reassessment of promotional program risk management

Consumer Protection and Legal Considerations

From a legal perspective, the incident presents complex questions about cryptocurrency ownership and error correction. While Bithumb successfully recovered most funds through voluntary returns, the exchange’s legal authority to freeze accounts and reverse transactions remains subject to regulatory interpretation. South Korea’s Specific Financial Information Act provides authorities with broad oversight powers, but the application to operational errors rather than illicit activities represents relatively uncharted territory.

Consumer protection advocates have emphasized the importance of transparent communication throughout the resolution process. Affected users received unexpected windfalls followed by sudden account restrictions, creating potential confusion and concern. The incident highlights the delicate balance exchanges must maintain between error correction and customer experience management.

Conclusion

The Bithumb Bitcoin error investigation represents a critical moment for cryptocurrency regulation and exchange operations in South Korea. While the immediate financial impact was largely mitigated through rapid recovery efforts, the incident exposes significant vulnerabilities in exchange operational controls. Regulatory authorities will likely use their findings to strengthen oversight requirements, potentially influencing global standards for cryptocurrency exchange operations. As the investigation continues, market participants will closely monitor developments that could reshape operational risk management across the digital asset industry. This Bithumb Bitcoin error serves as a powerful reminder that in cryptocurrency markets, technological sophistication must be matched by equally robust operational safeguards.

FAQs

Q1: What exactly happened with the Bithumb Bitcoin error?
An employee mistakenly set the payment unit to Bitcoin instead of Korean won while distributing promotional prizes, resulting in 695 customers receiving at least 2,000 BTC each instead of small cash amounts.

Q2: How much money was involved in the Bithumb Bitcoin payout mistake?
The error exposed Bithumb to potential losses exceeding 60 trillion Korean won (approximately $45 billion USD at the time), based on Bitcoin’s market price when the incident occurred.

Q3: Did Bithumb recover the mistakenly sent Bitcoin?
Yes, Bithumb recovered 618,212 BTC, representing 99.7% of the erroneously distributed funds, by blocking affected accounts and requesting returns from recipients.

Q4: Why are South Korean authorities investigating this Bithumb incident?
Financial authorities are investigating due to the enormous scale of potential damages, concerns about exchange operational integrity, and implications for cryptocurrency market stability in one of the world’s most active crypto markets.

Q5: How did this Bithumb error affect Bitcoin’s price?
The error created substantial selling pressure on Bithumb’s platform, causing Bitcoin’s price on the exchange to plummet significantly below global market rates until trading was suspended for affected accounts.