South Korean cryptocurrency exchange Bithumb asks local court to freeze seven bitcoins worth about $8 million, which was not returned after a payment error in February. The move escalates a dispute with a small group of users who have refused to return the funds.
The exchange said it had initiated a provisional seizure, a pre-trial step that prevents a debtor from moving its assets, according to local media. A civil case is expected to follow.
It all started on February 6, when the exchange held a promotion to pay out 620,000 won (~$460) to 249 winners. Staff mistakenly entered “BTC” instead of “KRW,” leading the system to credit each winner with 620,000 bitcoins in Bithumb’s internal records. It was a human error that briefly made it appear as if the exchange had created over $40 billion worth of BTC.
Within minutes, some users sold around 1,788 BTC before Bithumb froze their accounts, pushing its BTC/KRW price down to the low range of 80 million won ($54,000).
The exchange canceled most entries and recovered the bulk of the coins sold, but about 12.3 billion won ($8.3 million) remained in circulation. This figure has since fallen to seven bitcoins after months of raising awareness.
Korean legal experts, according to local reports, say such cases fall under unjust enrichment, meaning the beneficiaries must return the assets. If coins were sold, users may have to repurchase them at higher prices to repay.
This episode shows how human error, combined with the speed and irreversibility of crypto transactions, can turn minor errors into multi-million dollar crises.
Bithumb is the second-largest cryptocurrency exchange in South Korea, according to Coingecko, with a 24-hour trading volume of $388 million, behind Upbit, which recorded $788 million over the same period.
