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A routine promotional campaign by South Korean crypto exchange Bithumb took a disastrous turn this week when a technical glitch accidentally distributed $44 billion worth of bitcoin to a small group of users.
The digital asset market includes more than 20,000 cryptocurrencies, with bitcoin the best known. Major platforms, acting like digital banks, oversee millions of accounts, with daily trading volumes estimated in the billions of dollars.
Bithumb ranks as South Korea’s second-largest crypto exchange, with about 2.5 million active users and an estimated $412 million in daily trading volume.
The glitch occurred when the company issued rewards to users as part of a promotion a few days ago. Each user was supposed to receive a reward worth $1.4.
However, a technical fault in the system responsible for distributing rewards resulted in roughly 620,000 bitcoins being sent to users, valued at about $44 billion at the time of transfer.
Traders noticed a sudden surge in balances, prompting Bithumb to freeze trading and withdrawals on the affected accounts for 35 minutes.
The number of accounts impacted reached 695, meaning each user received around 892 bitcoins, equivalent to approximately $63 million per account.
The platform recovered most of the bitcoin by activating its abnormal transaction monitoring system.
Its CEO issued an apology, stressing that the company takes full responsibility and that user trust and trading security remain its top priorities.
Bithumb has a track record of management problems. The company previously lost millions of dollars after a series of hacks, the most recent in 2019.
It is now facing investigations by South Korean regulators over allegations of inflated liquidity, as well as a controversial promotional campaign.
Following the incident, the company announced urgent measures, including activating crisis management, forming a team to compensate those affected, strengthening its systems to prevent similar incidents from recurring, and issuing compensatory rewards to impacted users.
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