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- Bithumb has reportedly asked a court to freeze accounts holding 7 BTC tied to its mistaken bitcoin distribution.
- The exchange’s February giveaway error allegedly sent out 620,000 BTC after a staff member entered BTC instead of KRW.
Bithumb is reportedly pursuing legal action after one of the more extreme exchange errors in recent memory, a mistaken bitcoin distribution that local media says stemmed from a simple unit-entry failure.
According to a Thursday report from Chosun Biz, the South Korean exchange recently asked the court to freeze accounts linked to the incident through a provisional seizure covering 7 BTC, worth about $496,000. That figure is small relative to the scale of the original error, but it shows the exchange is now moving from internal damage control to formal recovery efforts.
A giveaway error turned into a massive liability
The incident dates back to Feb. 6, when Bithumb was said to have accidentally distributed 620,000 BTC across hundreds of user accounts as part of a promotional campaign. At the time, that amount was worth more than $43 billion.
The reported cause was almost absurdly simple. A staff member allegedly entered the reward unit in BTC instead of KRW, the Korean won. In crypto, where a misplaced decimal can already do damage, confusing bitcoin with fiat turns an operational mistake into something much larger very quickly.
That is the kind of failure that tends to expose more than one weak point at once. Not just human error, but also the absence, or failure, of controls that should have caught it before anything reached users.
Court action suggests recovery is getting more difficult
The decision to seek provisional seizure suggests Bithumb may not have been able to recover all distributed assets through direct negotiation or voluntary returns. Freezing accounts is usually what comes next when the easy part is over.
It also raises a practical issue for centralized exchanges. Promotional campaigns and internal balance adjustments are supposed to be routine operations. When those systems break at this scale, the problem is no longer only financial. It becomes a trust and controls question too.
For Bithumb, the legal route may recover part of the loss. But the larger challenge is explaining how an exchange large enough to handle billions in digital assets allowed a BTC-versus-KRW input mistake to get this far in the first place.
