South Korea widened exchange inspections after Bithumb’s Bitcoin crediting error

South Korea’s Financial Services Commission said on February 9, 2026, that authorities would examine internal controls across the country’s cryptocurrency exchanges after Bithumb erroneously credited customer accounts with 620,000 BTC during a promotional event.

The government’s response extended beyond correcting one exchange’s accounting failure. The Digital Asset Exchange Alliance, or DAXA, was assigned to begin an industry-level review, with the Financial Supervisory Service expected to conduct on-site inspections based on its findings. Authorities specifically identified controls connecting customer ledgers to assets held, multiple-verification procedures and safeguards against human error.

That made the February 9 announcement an institutional turning point in the incident: regulators were treating Bithumb’s mistake not merely as an isolated operational accident, but as evidence of a potentially broader weakness in exchange governance.

A won-denominated reward became a Bitcoin credit

The FSC’s February 9 Korean-language record said the error occurred at about 19:00 Korea Standard Time on February 6, 2026, while Bithumb was distributing promotional rewards to 695 participants. Instead of entering a reward of 2,000 Korean won per person, the exchange credited recipients with as much as 2,000 BTC.

According to the regulator’s chronology, Bithumb detected the mistake at 19:20, began restricting affected accounts at 19:35 and completed trading and withdrawal restrictions at 19:40. The incident therefore unfolded within roughly 40 minutes, although trades executed before the restrictions created a recovery and compensation problem.

The FSC reported that, as of 04:00 on February 7, Bithumb had recovered 618,214 BTC—99.7% of the 620,000 BTC credited—before those balances were traded. It said 1,786 BTC had already been sold and that approximately 93% of that amount had been recovered.

Bithumb’s February 8 statement used a slightly different sold quantity of 1,788 BTC. It said company assets were used to restore full consistency between customer deposits and exchange holdings by 22:45 on February 7. The two-BTC discrepancy between the regulator’s and Bithumb’s contemporaneous tallies remains unresolved in the cited records, so the figures should not be combined as though they were one audited dataset.

The records describe erroneous entries on Bithumb’s internal customer ledger, not the creation of 620,000 new bitcoins or an equivalent transfer recorded on the Bitcoin blockchain. That distinction matters: the failure concerned the exchange’s representation and handling of customer balances rather than Bitcoin’s issuance rules.

Regulators moved from recovery to structural controls

The FSC said the initial response unit included the commission, the Korea Financial Intelligence Unit, the FSS and DAXA. Authorities first reviewed customer harm, Bithumb’s recovery efforts and compensation for users who sold during the disruption. On February 8, FSC Chairman Lee Eog-weon then directed officials to examine controls at Bithumb and every other domestic exchange.

The February 9 announcement also described possible legislative measures. These included requiring periodic external reviews of exchange asset holdings, imposing internal-control standards comparable to those applied to financial companies, and making virtual-asset service providers strictly liable for user losses caused by data-processing errors.

Those measures were proposals connected to pending second-stage virtual-asset legislation, not rules already in force on February 9. Likewise, the announcement of inspections did not establish that other exchanges had the same deficiencies.

Why the incident mattered

Bithumb’s error demonstrated how an exchange’s internal database can temporarily display tradable claims far beyond the balances intended by the operator. Even without a blockchain compromise, failures in authorization, reconciliation and transaction controls can affect a venue’s order book and its customers.

The surviving sources report a brief, sharp decline in Bitcoin’s price on Bithumb during the incident, but they do not provide a consistent tick dataset, standardized comparison venue or common measurement window. No percentage or global-market effect is therefore asserted here. The verifiable consequence on February 9 was regulatory: South Korea converted one exchange’s accounting failure into an industry-wide examination of custody records, operational controls and user-protection responsibilities.