Bithumb to Reimburse Customers After $40B Bitcoin Distribution Error

Bithumb Commits to Customer Reimbursement After Bitcoin Overpayment

South Korean crypto exchange Bithumb announced its plan to fully compensate users affected by a significant error that resulted in the distribution of 620,000 Bitcoin, valued at over $40 billion, to 695 users during a reward event.

Incident Details and Immediate Response

The overpayment occurred on February 6 due to an input error during the reward process. Bithumb identified the issue within 20 minutes, promptly halting all transactions and withdrawals.

Bithumb successfully recovered nearly all of the overpaid Bitcoin, reclaiming 618,212 BTC or 99.7% of the total. Additionally, 93% of the assets that recipients had sold were recovered, with none transferred off-platform.

“We sincerely apologize for the confusion and inconvenience caused to our customers due to the overpayment incident,” stated Bithumb CEO Lee Jae-won. “We feel a deep sense of responsibility for failing to uphold the top priorities of a virtual asset exchange: stability and integrity.”

Compensation and Preventative Measures

Bithumb reported customer losses from panic selling during the incident totaled approximately 1 billion Korean won (over $680,000) as of February 7. The company will provide 110% compensation to those who sold at unfavorable prices. Additionally, all users who accessed the platform during the incident will receive 20,000 KRW ($15), and trading fees will be waived for seven days.

To prevent future incidents, Bithumb announced a permanent Customer Protection Fund worth 100 billion Korean won ($68 million). The Financial Supervisory Service and Financial Services Commission are currently investigating the incident.

Bithumb is collaborating with regulators and plans to implement system enhancements, including improved asset verification, multi-step payment approvals, and an AI-powered Safeguard for 24-hour abnormal transaction detection.