Bithumb Under Fire: $44 Billion Bitcoin “Gifting” Error Triggers Regulatory Blitz
In what is being described as the largest operational blunder in South Korean crypto history, Bithumb is facing a multi-agency...
Quick overview
- Bithumb is under investigation for mistakenly distributing 620,000 Bitcoin, valued at approximately $44 billion, during a marketing campaign gone wrong.
- The error occurred when a 'unit entry error' led to users receiving 2,000 BTC instead of 2,000 won, impacting 695 users and causing a significant market disruption.
- Regulators, including the FSS and KFTC, are investigating potential violations of internal controls and the marketing practices surrounding the promotion.
- In response, Bithumb has announced a compensation package for affected users and plans to enhance its operational safeguards to prevent future errors.
In what is being described as the largest operational blunder in South Korean crypto history, Bithumb is facing a multi-agency investigation after accidentally distributing 620,000 Bitcoin (BTC)—valued at approximately 60 trillion won ($44 billion)—to users during a botched marketing campaign.
The incident happened on February 6, 2026, and quickly affected the digital asset market. Bithumb went into emergency recovery, and both the Financial Supervisory Service (FSS) and the Korea Fair Trade Commission (KFTC) responded right away.
The ‘Random Box’ Mistake: From 2,000 Won to 2,000 BTC
The problem started during a regular ‘Random Box’ promotion, which was meant to give users small cash prizes between 2,000 and 50,000 won. Bithumb says a ‘unit entry error’ caused the system to give winners 2,000 BTC each instead of 2,000 won.
Key Details:
- Participants: 695 users received the mistaken payout.
- Active Impact: 240 users opened their boxes and suddenly saw billions of won in their accounts.
- The Error: Management entered ‘BTC’ instead of ‘KRW’ during the payout process.
- Individual Windfall: Since BTC was trading at about 98 million won, each recipient’s account briefly showed 196 billion won ($143 million).
Market Flash Crash and the Aftermath of Panic Selling
The sudden arrival of ‘free’ Bitcoin quickly disrupted Bithumb’s order books. As users tried to sell their unexpected gains, Bitcoin’s price on the exchange dropped 17% to 81.11 million won, even though global prices stayed close to 100 million won.
Bitcoin and the Bithumb $44B Flash Shock
I spent the afternoon tracking a bizarre event in the South Korean markets that I’ve never seen before: @BithumbOfficial accidentally distributed $44 billion worth of bitcoins as "rewards" due to a promotional error. I watched the local… pic.twitter.com/8WalXZcten
— IFreqs (@0xifreqs) February 7, 2026
Bithumb’s automated safeguards, like its domino liquidation prevention system, stopped a total market collapse. The exchange froze affected accounts within 35 minutes and says it has recovered 99.7% of the funds. Still, users withdrew about 3 billion won before the freeze, and around 125 BTC are still missing.
Regulators Respond: FSS and KFTC Begin Investigations
Because of the size of the error, regulators responded quickly. On January 7, FSS officers went to Bithumb’s headquarters to look into possible violations of internal controls.
Parallel Investigations:
- FSS/FSC: Focusing on financial stability, internal risk management, and whether the exchange violated the Virtual Asset User Protection Act.
- KFTC: Investigating the “Random Box” marketing materials to determine if the promotion was deceptive or if Bithumb modified payout terms mid-event to cope with the surge in participants.
- Legislative Scrutiny: CEO Lee Jae-won has been called to upcoming parliamentary hearings to explain what went wrong with oversight.
Bithumb’s Path to Redemption: Compensation and New Safeguards
To address the situation, Bithumb has announced a large compensation package for users affected by the local price drop.
| Compensation Measure | Target Audience |
| Loss Refund + 10% | Users who sold BTC at depressed prices (81M–90M KRW) during the crash. |
| 20,000 KRW Payout | All users logged into the platform during the incident. |
| Fee Waiver | One week of zero-fee trading for all listed assets. |
| Protection Fund | Creation of a 100 billion won ($73M) Customer Protection Fund. |
“I sincerely bow my head in apology,” stated CEO Lee Jae-won. “We will take responsibility to the end to ensure no customer suffers losses due to this operational failure.”
The exchange has promised to improve its multi-approval systems and use AI to spot unusual activity, aiming to prevent another ‘unit error’ like this in the future.
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