South Korean cryptocurrency exchange Bithumb accidentally distributed 2,000 Bitcoin (BTC) worth approximately $133 million to hundreds of users after a staff member entered the wrong currency code during a rewards payout, according to multiple reports.
Fat Finger Error Causes Immediate Market Selloff
A staff member tried to distribute 2,000 Korean won worth less than $2 as a random box prize but entered BTC by mistake, according to Dumpster DAO core member Definalist, who first reported the incident on February 6.
In a statement, the company said the incident did not result in any loss or damage to customer assets.
The error triggered immediate sell pressure as recipients dumped the Bitcoin on the exchange.
Bitcoin's price on the Bithumb platform plummeted by 10% compared to other markets Phemex, with the asset briefly trading around $56,000 on Bithumb while maintaining levels above $66,000 on global exchanges.
Price Impact Contained To Single Exchange
The price crash was largely confined to Bithumb due to the exchange's isolated order book, with users selling massive amounts of BTC directly on the platform and overwhelming its liquidity.
Bitcoin's price on Bithumb has rebounded to above $66,000, up from a low of around $56,000 Crypto Briefing following the incident.
Bithumb Remains Silent On Recovery Plans
Bithumb has not publicly confirmed the details of the alleged transfer error or the exact amount of Bitcoin involved.
It also remains unclear whether the funds were successfully withdrawn, frozen, or reversed, or whether affected trades will be rolled back.
Also Read: Why Michael Saylor Says Acting Too Fast On Quantum Threats Could Destroy Bitcoin Instead Of Save It
Regulatory Scrutiny Intensifies Amid Operational Failures
The operational error comes at a sensitive time for Bithumb.
On February 4, the South Korean Fair Trade Commission sent investigators to Bithumb's headquarters to probe whether advertisements claiming the exchange has the highest level of liquidity in the domestic crypto exchange sector were potentially misleading or exaggerated.
Bithumb has a checkered history with security and operational issues.
In 2017, a data breach exposed customer information, and in a 2020 ruling, the exchange was found partially liable in one case in which a user lost $27,200
Read Next: Why The World's Biggest Stablecoin Issuer Just Invested $150M In Gold During A Market Crisis