Bithumb Files Lawsuit to Freeze Mistaken BTC Accounts

Background and Context

The error occurred on February 6, 2026, during Bithumb’s “Random Box” promotional event. The exchange intended to distribute modest cash rewards denominated in Korean won to eligible participants. However, an employee mistakenly entered the reward unit as BTC instead of KRW, causing the system to credit users with Bitcoin values rather than fiat amounts. 

Importantly, these were not actual on-chain Bitcoin transfers. Instead, the credits existed as internal ledger balances, often referred to as “ghost Bitcoin,” inside Bithumb’s trading system. Bithumb identified the issue quickly and froze affected accounts within roughly 35 minutes, limiting the damage before more users could withdraw or sell the assets.

However, before the freeze took effect, several users managed to sell part of the mistakenly credited BTC. This sudden sell pressure caused a sharp localized market disruption, with BTC/KRW on Bithumb briefly falling as much as 17%. Notably, this type of fat-finger error is rare but not unprecedented.

For context, South Korea previously saw a similar large-scale clerical mistake in Samsung Securities’ 2018 ghost-share incident, while the crypto sector has seen comparable payout errors such as Compound’s 2021 accidental token distribution. 

Legal Proceeding

The legal battle surrounding the Bithumb fat-finger error has now intensified. Specifically, the exchange has applied for provisional seizure orders, a pre-lawsuit asset freeze mechanism under South Korean law, targeting accounts linked to the remaining 7 BTC.

At current prices, that balance is worth roughly $470,000 to $500,000. According to the exchange, it successfully recovered 99.7% of the erroneous credits and reclaimed about 93% of the Bitcoin that users sold before the freeze. Still, a small group of recipients has refused to return the funds voluntarily. 

Consequently, Bithumb is now relying on South Korea’s unjust enrichment framework, arguing that users have no legal right to retain assets credited by mistake. The exchange has also stated that no external hack or security breach occurred and confirmed that it will absorb any residual losses from its own reserves.

Regulatory Fallout and Push for Tighter Rules

Meanwhile, the regulatory consequences continue to grow. South Korea’s Financial Supervisory Service (FSS) launched a full investigation shortly after the incident, focusing on Bithumb’s internal controls, risk management systems, and operational safeguards.

In addition, lawmakers have used the incident to push for faster progress on the Digital Asset Basic Act, which would introduce stricter compliance standards for exchanges, including capital requirements and stronger internal control frameworks. As a result, analysts believe this case could become a major legal and regulatory precedent.