South Korea Probes Exchange After $44B Bitcoin Giveaway Glitch

South Korean financial regulators opened an emergency review after a major cryptocurrency exchange mistakenly credited hundreds of users with billions of dollars in bitcoin, in an error that briefly roiled markets and underscored weak internal controls at digital asset platforms.

The glitch occurred on Feb. 6, 2026, when Bithumb, one of the country’s largest crypto exchanges, attempted to issue small promotional rewards. Instead of depositing modest cash credits, the platform’s system credited at least 2,000 bitcoin (BTC) to more than 690 accounts. Collectively, these credits amounted to around 620,000 BTC, roughly $44 billion at current prices.

Within minutes, some recipients began selling the erroneously credited bitcoin, triggering a sharp drop in bitcoin’s price on Bithumb’s order books. The exchange halted trading and withdrawals for the affected accounts within about 35 minutes and worked to reverse the mistake.

Error, Market Reaction and Recovery Efforts

Bithumb said the error stemmed from a system misconfiguration during a promotional campaign intended to give users a few thousand Korean won — about $1.40 — each. The exchange stressed that the incident was not linked to a hack or external security breach.

The error briefly pushed bitcoin prices down as much as 17% on Bithumb’s platform before controls restored stability. Exchange charts showed the price dip, and officials said markets normalised once selling pressure eased and the glitch was addressed.

Bithumb reported that it recovered about 99.7% of the misallocated bitcoin. Officials also said that 93% of the roughly 1,786 BTC sold before the halt were retrieved from traders after the incident.

Regulators Intensify Oversight After Incident

South Korea’s Financial Supervisory Service (FSS) said the giveaway glitch highlighted weaknesses in exchanges’ internal control systems and crypto information frameworks. FSS Governor Lee Chan-jin indicated that regulators could order on-site inspections and broader reviews of exchanges if they find similar vulnerabilities.

Authorities also raised concerns about so-called “ghost coins”, where platforms show or distribute crypto they do not actually hold. Regulators said this complicates efforts to treat cryptocurrencies as credible financial products.

Officials noted that people who sold the mistakenly credited bitcoin are legally obligated to return the funds. The probe aims to determine whether Bithumb violated financial regulations and whether additional rules are needed to protect investors and markets.