South Korea’s Financial Supervisory Service (FSS) has escalated scrutiny of major cryptocurrency exchange Bithumb following an unprecedented operational mistake in which the firm accidentally credited customers with tens of billions of dollars’ worth of Bitcoin.
Summary
- South Korea’s Financial Supervisory Service (FSS) has launched a full-scale investigation into Bithumb following a massive $43 billion Bitcoin “fat-finger” error.
- The incident stemmed from an internal operational mistake that temporarily credited users with Bitcoin far exceeding the exchange’s actual holdings.
- Regulators are examining Bithumb’s internal controls and IT systems, with potential penalties possible if violations are confirmed.
The investigation follows a striking error on February 6, 2026, when Bithumb, during a routine promotional event, inadvertently distributed 620,000 Bitcoin, worth roughly $40 billion to $44 billion at market prices, to users instead of the intended small cash rewards.
The mishap stemmed from an employee inputting payouts in Bitcoin (BTC) units rather than Korean won, leading to an explosion of overissued Bitcoin credits before the mistake was detected.
What happened in the Bithumb mistake
In a “Random Box” promotion designed to reward users with modest cash amounts, Bithumb’s payout system mistakenly issued Bitcoin due to a unit entry error, resulting in the colossal overshoot.
Within minutes, hundreds of users found massive sums of Bitcoin in their accounts, equivalent to 13–14 times Bithumb’s actual BTC holdings based on industry estimates.
The exchange acted swiftly to freeze affected accounts and block trading and withdrawals within about 35 minutes, recovering the vast majority of the missent tokens. Still, a small portion, representing millions in value, was sold or withdrawn before the controls took effect.
FSS investigation and regulatory response
Initially launching an emergency review, the FSS escalated its examination to a full-scale formal investigation. Bithumb was notified of the probe signalling a deep dive into what went wrong and whether internal controls violated the Virtual Asset User Protection Act or other regulatory standards.
FSS Governor Lee Chan-jin has emphasized that the episode revealed systemic weaknesses in internal control and electronic ledger systems at the exchange. Regulators are examining how an exchange with far fewer actual reserves was able to record and disburse phantom Bitcoin balances so rapidly.
Depending on what investigators find, the probe could lead to sanctions against Bithumb, including fines or even suspension of operations if negligence or legal violations are confirmed. The FSS has also noted that users who sold erroneously credited Bitcoin may be legally obligated to return it as unjust enrichment under current interpretations of Korean law.
