South Korea Extends Bithumb Probe After 620,000 BTC Error Sparks Outrage

TLDR

• FSS extends Bithumb probe after BTC crediting glitch sparks wider scrutiny.
• Bithumb credited 2,000 BTC each in error, prompting tougher oversight reviews.
• Missing BTC and past payout errors return to spotlight as inquiry expands.
• Korea inspects top exchanges for control gaps after Bithumb’s system failure.
• Lawmakers demand accountability as regulators tighten crypto compliance checks.

South Korea has expanded its investigation into Bithumb after a major system error pushed regulators to intensify scrutiny of the exchange. Authorities extended the probe as concerns continued rising over internal controls and digital-asset oversight. The review widened as lawmakers demanded firm accountability across the broader trading sector.

FSS Extends Inquiry as Oversight Concerns Deepen

The Financial Supervisory Service extended its original deadline and continued its review through the end of February. Officials expanded their focus and evaluated possible gaps in Bithumb’s internal safeguards. The inspection team strengthened its work and targeted compliance issues linked to platform design and asset handling.

The regulator examined how Bithumb credited coins it did not actually possess during a recent promotional event. The team assessed whether system failures created new risks across user accounts. They also reviewed whether additional payout errors occurred without detection.

Authorities maintained that more irregularities could appear as the investigation progressed. They emphasized that any findings would shape future enforcement steps and regulatory adjustments. The probe signaled a broader effort to strengthen South Korea’s digital-asset supervision.

Past Distribution Cases Reemerge Amid New System Failure

Bithumb faced renewed criticism after crediting users with 2,000 Bitcoin each instead of a small cash reward. The exchange processed a total amount of 620,000 BTC that it never held. The platform recovered most assets but confirmed that 125 BTC remained missing.

Lawmakers argued that the event highlighted long-standing structural issues in market oversight. They noted that regulators had inspected Bithumb several times since 2022 without preventing major failures. Their criticism intensified as the extended probe drew national attention.

The incident resurfaced two previous cases involving mistaken payouts from earlier years. Regulators confirmed they would review those events within the current investigation. This step indicated growing pressure to verify whether past safeguards functioned effectively.

Wider Industry Review Expands Across Korean Exchanges

South Korean authorities launched a parallel inspection involving Upbit, Coinone, Korbit and GOPAX. Teams assessed asset verification rules and examined control systems across all four platforms. They aimed to identify weaknesses that could trigger similar disruptions.

The Digital Asset eXchange Alliance supported the process and prepared updates to its self-regulatory standards. These revisions will reflect any issues discovered during the inspections. Regulators indicated that stronger rules would guide the next phase of national crypto legislation.

Officials also faced renewed questions after separate incidents involving missing government-held Bitcoin resurfaced. These earlier cases involved unrecovered assets from police and prosecution cold wallets. Their reappearance further intensified scrutiny of national digital-asset management.

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