Financial authorities have initiated a formal investigation into Bithumb, a local cryptocurrency exchange, to ascertain how it managed to disburse over 60 trillion won ($41.2 billion) in bitcoins that it reportedly did not possess. Regulators notified the exchange of the investigation following an on-site inspection conducted three days earlier, as reported by industry sources. The Financial Supervisory Service (FSS) official emphasized the gravity of the situation, stating that strict legal actions will be taken against any activities that disrupt market order.
In a promotional event on Friday, Bithumb mistakenly transferred 620,000 bitcoins instead of the intended 620,000 won to 249 customers, leading to a sell-off on the exchange. Although most of the erroneously sent bitcoins were promptly recovered, the exchange disclosed that 1,788 tokens had already been sold. Bithumb, like other centralized exchanges, employs a “book-entry trading system” that manages ownership and trade executions internally, potentially causing discrepancies between stated balances and actual reserves if mishandled.
As of the end of September, Bithumb held approximately 42,000 bitcoins, with the majority being customer-owned crypto assets except for 175 tokens. The ongoing investigation coincides with legislative discussions on virtual assets at the National Assembly. The Financial Supervisory Service (FSS) has announced plans to implement stricter penalties for financial institutions in cases of IT infrastructure-related incidents. These measures aim to enhance consumer protection by enforcing punitive actions and reinforcing IT security regulations within the financial sector.
