• Recovery of nearly $43.7 billion within minutes with trading temporarily halted
• Regulatory warnings followed a 17% drop in Bitcoin before prices rebounded

South Korean cryptocurrency platform Bithumb announced a technical error that led to massive transfers of Bitcoin into some users’ accounts as promotional rewards, causing severe market disruption within the exchange.

The company stated on Saturday that the glitch occurred on Friday, resulting in the distribution of roughly 620,000 Bitcoins, valued at about $44 billion at current prices. It confirmed that 99.7% of the funds were recovered quickly after freezing trading and withdrawals for the 695 affected users within just 35 minutes of detecting the mistake.

Media reports indicated that the platform had intended to distribute small cash rewards of at least 2,000 Korean won (around $1.40) per user during a promotional campaign, but winners instead received no less than 2,000 Bitcoins each due to the technical error.

Bithumb emphasized that the incident was unrelated to external hacks or security breaches, affirming the integrity of its systems and customer asset management.

Meanwhile, South Korea’s financial regulators, including the Financial Services Commission, noted that the event exposed vulnerabilities and risks in the virtual asset market. They indicated that on-site inspections of Bithumb and other exchanges may follow if reviews of internal controls or asset management reveal irregularities.

The error caused Bitcoin prices on the platform to plunge nearly 17% on Friday evening to 81.1 million won before later recovering to about 104.5 million won.

These developments come as Bithumb holds the second-largest position in South Korea’s cryptocurrency market, behind Upbit, which dominates trading volume.