Crypto: Bithumb Confirms Reward Payout Error After Abnormal Bitcoin Trades

The South Korean exchange said an internal error during a promotional event led to brief price dislocations, stressing that no customer assets were lost.

Bithumb said it identified and corrected an internal payout error after an “abnormal amount” of Bitcoin was credited to some user accounts during a promotional event, briefly causing sharp price fluctuations on the exchange.

In a company announcement on Friday, the South Korean crypto exchange said the price dislocation occurred after some recipients sold the mistakenly credited Bitcoin, but that it quickly restricted the affected accounts through internal controls, allowing market prices to stabilize within minutes and preventing any chain liquidations.

Bithumb said the incident was unrelated to any hacking or security breach and did not result in losses to customer assets, adding that trading, deposits and withdrawals are operating normally. The company said that customer funds remain safely managed and that it will transparently disclose follow-up actions to prevent similar errors.

While Bithumb did not disclose the amount involved, several users on X claimed that some accounts were erroneously credited with roughly 2,000 Bitcoin (BTC), a claim that has not been independently verified.

The news comes after Bithumb said in January that it had identified roughly $200 million in dormant customer assets spread across 2.6 million accounts that had been inactive for more than a year, as part of a recovery campaign.

According to CoinGecko, Bithumb currently carries a trust score of 7 out of 10 and reported roughly $2.2 billion in 24-hour trading volume at the time of writing.

Related: Bithumb halves crypto lending leverage, slashes loan limits by 80%: Report

Beyond price volatility, the past year has exposed operational challenges at centralized cryptocurrency exchanges that have affected users during routine activity and periods of market stress.

In June, Coinbase acknowledged that restrictions on user accounts had been a major issue for the exchange, and claimed it had reduced unnecessary account freezes by 82% following upgrades to the exchange’s machine-learning models and internal infrastructure.

Source: CoinTelegraph