Bithumb’s $40B bitcoin error triggers legal action

Bithumb faces legal action after a $40B bitcoin payout error, with seven bitcoins still missing. The incident has led to asset freezes, regulatory scrutiny, and highlighted exchange risks.

Bithumb, a leading South Korean cryptocurrency exchange, is facing a major legal challenge after a critical error during a February promotional event resulted in 620,000 bitcoin—worth over $40 billion—being mistakenly credited to 249 users. The error stemmed from an employee entering "BTC" instead of "KRW" as the payout currency. Some users quickly sold about 1,788 BTC before Bithumb froze the affected accounts, causing a sharp drop in the BTC/KRW trading pair. While most of the funds were recovered, around seven bitcoins remain unreturned. Bithumb has obtained court orders to freeze these assets, valued between $500,000 and $8 million, as a preliminary step before pursuing civil litigation. The incident has drawn regulatory scrutiny and underscored the operational risks faced by crypto exchanges. Meanwhile, a Seoul court overturned a separate business suspension against Upbit, citing unclear rules for certain transactions. This highlights the evolving regulatory landscape in South Korea's cryptocurrency sector.