South Korean cryptocurrency exchange Bithumb has announced a comprehensive reimbursement plan following a catastrophic operational error that saw the platform mistakenly distribute 620,000 BTC—valued at approximately $51 billion—to users. The announcement comes just two days after a "fat finger" mistake by an employee triggered a localized flash crash, causing panic among traders and forcing the exchange to freeze deposits and withdrawals.

The $51 Billion "Fat Finger" Mistake

The chaos began on the evening of February 6, 2026, during a routine promotional event intended to reward users with small amounts of points or local currency. According to Bithumb's official statement, an employee inadvertently entered "Bitcoin" instead of "Korean Won" into the distribution system. Instead of receiving a nominal reward of roughly 2,000 KRW (about $1.50), hundreds of lucky—and confused—users found their accounts credited with 2,000 BTC each.

The total erroneously distributed amount reached a staggering 620,000 BTC mistake, representing nearly 3% of the total Bitcoin supply in circulation. For a brief moment, the on-paper value of these assets exceeded $51 billion, a figure that dwarfs the reserves of most global financial institutions. "I doubted my eyes when I saw trillions of won in my account," one user reported on a local forum, capturing the disbelief that rippled through the community.

Flash Crash and Market Panic

The massive influx of artificial liquidity had immediate and chaotic consequences. As users rushed to liquidate their windfall, the Bitcoin price volatility today on Bithumb decoupled violently from global markets. The sudden sell pressure caused a Bithumb flash crash 2026, sending the price of Bitcoin plunging by over 17% on the platform within minutes, dropping as low as $55,000 locally while global prices remained steady around $66,000.

Recognizing the anomaly, Bithumb's security systems triggered an emergency halt. Trading, deposits, and withdrawals were suspended for affected accounts within 35 minutes of the error. "We identified an abnormal transaction pattern and immediately restricted access to prevent further market distortion," a Bithumb spokesperson explained. Despite the quick reaction, approximately 1,788 BTC were sold before the freeze, creating significant realized losses for the exchange and confusion for traders who bought the dip.

Crypto Exchange Reimbursement Plan

In a press conference held on Sunday, February 8, Bithumb CEO Lee Jae-won issued a public apology and outlined a crypto exchange reimbursement strategy to restore user trust. The exchange has successfully recovered 99.7% of the mistakenly distributed assets, amounting to 618,212 BTC. For the remaining unrecovered funds and to compensate users who suffered losses during the flash crash, Bithumb has pledged to use its own corporate reserves.

The reimbursement plan includes:

  • Full Restitution: Traders who sold assets at artificially low prices during the crash will be compensated.
  • 110% Compensation: Affected users will receive 110% of their calculated losses to cover the inconvenience.
  • Activity Bonus: All users active during the incident will receive a flat compensation of 20,000 KRW.
  • Fee Waiver: Trading fees will be waived for all users for the next seven days.

Regulatory Scrutiny Intensifies

This incident has drawn sharp attention from South Korean regulators. The Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) have launched an emergency on-site inspection to investigate cryptocurrency exchange security protocols at Bithumb. Authorities are particularly concerned with how a single employee's input error could bypass internal controls to move such a colossal sum of digital assets.

The blunder highlights the fragile nature of centralized exchange infrastructure and the critical need for robust verification systems. "This is a wake-up call for the entire industry," said Park Min-soo, a senior analyst at Seoul Crypto Insight. "When human error can trigger a $51 billion liability in seconds, the safeguards are clearly insufficient."

Impact on South Korea Crypto News

As the dust settles, the South Korea crypto news cycle is dominated by discussions on exchange reliability. Bithumb, the nation's second-largest exchange, faces a steep uphill battle to rebuild its reputation. While the prompt recovery of funds averted a total solvency crisis, the reputational damage is severe. The exchange has promised to implement AI-driven monitoring tools and multi-signature approval processes to ensure such a catastrophic error never happens again.