A South Korean cryptocurrency exchange has admitted to a massive payout error that briefly turned hundreds of its users into instant multi-millionaires.
The incident happened on Friday when Bithumb, one of the country’s largest crypto trading platforms, attempted to distribute a small promotional reward to its customers. Each user was supposed to receive just 2,000 won—about $1.37—but a system glitch sent out 2,000 bitcoins instead.
At current market prices, the mistake translated into more than $40 billion worth of bitcoin being credited to user accounts. For a short window, hundreds of customers suddenly found themselves holding fortunes they never expected.
Bithumb said the error affected 695 users, and the company quickly moved to contain the situation. Within 35 minutes of discovering the glitch, the exchange froze trading and withdrawals for the impacted accounts to prevent further movement of funds.
The exchange stressed that the incident was not the result of a hack or external attack. Instead, it described the event as an internal system error, assuring users that there were no issues with its core security infrastructure or asset management systems.
According to the company, the total mistaken distribution involved about 620,000 bitcoins. By the time emergency measures were in place, Bithumb said it had managed to recover 99.7% of the tokens.
South Korea’s financial watchdog has already taken notice. During an emergency meeting on Saturday, the Financial Supervisory Service (FSS) said it would review the incident closely. Officials warned that any signs of illegal activity tied to the mistaken payouts could trigger formal investigations.
Bithumb, for its part, said it would cooperate fully with regulators. CEO Lee Jae-won described the incident as a wake-up call, promising to prioritize customer trust over aggressive expansion plans going forward.
To make amends, the exchange said it would compensate all users who were active on the platform at the time of the glitch. Each affected customer will receive 20,000 won (about $13.66), and trading fees will be waived for a period as part of the recovery plan.
The company also pledged to strengthen its internal controls. It plans to upgrade its verification systems and introduce artificial intelligence tools to detect abnormal transactions before they spiral into major incidents.
The episode has reignited conversations around operational risks in both crypto and traditional finance. In a similar case from April 2024, U.S. banking giant Citigroup mistakenly credited $81 trillion to a customer account instead of just $280. Although the error was caught and reversed within hours, it highlighted how even major institutions are vulnerable to costly system mistakes.
