TL;DR
- South Korean regulators opened an emergency review after a Feb. 6 promotion error credited users with at least 2,000 BTC each, implying 600,000+ BTC.
- Selling attempts pushed the exchange’s BTC price 15% to 17% below broader levels before a 35-minute freeze stopped trading and withdrawals.
- The exchange says it reversed 99.7% of credits, will seek legal recovery, and warned the incident highlights “ghost coin” and CEX risks.
A South Korean crypto exchange is facing regulator scrutiny after a promotional payout error briefly created the appearance of a $40 billion to $44 billion Bitcoin giveaway on customer balances. The episode is being framed as a controls breakdown that can move prices without any onchain transfer. The glitch on Feb. 6 occurred during a “Random Box” promotion meant to credit about 2,000 won, around $1.40, to about 690 to 695 users. Instead, rewards were issued in Bitcoin, with affected accounts showing at least 2,000 BTC each and an implied total above 600,000 BTC on the platform’s internal ledger for users and regulators.
Why the glitch reignited the CEX risk debate
Some recipients tried to sell immediately, producing a sharp but localized dislocation on the exchange’s BTC market. A purely internal ledger mistake still translated into execution risk inside the venue. Bitcoin prices on the exchange reportedly fell as much as 15% to 17% below broader market levels before stabilizing, while wider crypto markets were described as unaffected. The exchange detected the issue in about 35 minutes, froze trading and withdrawals for affected accounts, and said the incident was caused by misconfiguration rather than a hack.
The exchange says it has reversed about 99.7% of erroneous credits and is pursuing recovery of the remainder. Cleanup has been substantial, but the incident spotlighted “ghost coins” and fragile payout workflows. Estimates suggest roughly 125 to 1,788 BTC were sold before restrictions were imposed. Officials said sellers are legally obligated to return mistakenly credited funds, and the exchange said it will absorb any losses while taking legal steps to recover what remains. It also announced a week of commission free trading starting Feb. 9.
South Korea’s Financial Supervisory Service opened an emergency review and said the error highlighted weaknesses in internal control systems and crypto information frameworks. Regulators are signaling enforcement grade expectations for IT governance and investor protection. Officials indicated they could order on site inspections and broader reviews if similar vulnerabilities are found, and warned that technology safeguards should be treated as core risk management, not optional spending. The case also feeds the broader centralized exchange risk debate: even when no blockchain transfer occurs, internal systems can create false balances, distort order books, and test the credibility of market infrastructure.
