Bitcoin Price Shock in Korea: Inside the Bithumb Accidental BTC Distribution Incident

Bitcoin Price Shock in Korea: What Happened at Bithumb?

In early February 2026, South Korea’s cryptocurrency market experienced a sudden shock when Bitcoin prices on Bithumb sharply diverged from global markets.
The incident was later linked to an accidental Bitcoin distribution during a promotional event, raising serious questions about exchange systems, internal controls, and user protection.

This article explains what happened, why it mattered, and what it means for the broader crypto market — without speculation or investment advice.


Overview of the Incident

  • Date: February 6, 2026

  • Exchange: Bithumb (South Korea)

  • Type: Accidental Bitcoin over-distribution during a promotional “Random Box” event

  • Scale: Approximately 620,000 BTC recorded on internal ledgers as unintended balances

  • Recovery Rate: Around 99.7% reclaimed

Importantly, these Bitcoins were not newly minted on the blockchain, but appeared as internal ledger balances, often described as “ghost liquidity.”


What Caused the Accident?

The core issue was a unit input error during reward distribution.

Bithumb intended to distribute:

  • Rewards worth 2,000–50,000 KRW

However, the reward system mistakenly processed:

  • KRW amounts as BTC units

As a result, some users received rewards listed as thousands of BTC instead of small fiat-based bonuses.
This caused Bithumb’s internal system to temporarily reflect Bitcoin balances far exceeding its actual reserves.


Immediate Response by Bithumb

Once abnormal transactions were detected, Bithumb took rapid emergency action:

  • ⛔ Immediate suspension of deposits and withdrawals

  • 🔒 Freezing of affected accounts

  • 🔍 Internal audit of transaction logs and balances

These measures were reportedly implemented within approximately 35 minutes, limiting further market disruption.

Despite this, a small portion of assets had already been sold or converted, making full recovery technically impossible.


Market Impact: Sudden Price Drop and Exchange Gap

The most visible effect was a sharp Bitcoin price drop on Bithumb only.

  • Some users rushed to sell unexpectedly credited BTC

  • Bitcoin prices on Bithumb fell 10–20% below other major exchanges

  • Local prices briefly dropped to around 81 million KRW

This created a clear example of exchange-specific price distortion, rather than a global Bitcoin crash.


Legal and Regulatory Questions

The incident sparked debate around legal responsibility:

  • If users knew assets were mistakenly credited and still sold them,
    issues of unjust enrichment and misappropriation may arise.

  • Determining intent will depend on:

    • User behavior

    • Exchange terms of service

    • Future legal interpretation

The case highlights the regulatory gray zone that still exists in many crypto markets.


Structural Issues Revealed

1. Weak Internal Controls

A single unit input error caused a large-scale disruption, showing the need for stronger validation systems.

2. Limited Transparency

Most users cannot easily distinguish between blockchain-level activity and exchange ledger entries, increasing confusion during incidents.

3. Trust and Market Confidence

Even with fast recovery, the event damaged confidence in centralized exchanges.


What This Means for the Crypto Market

This incident was not about Bitcoin’s technology failing.
It was about operational risk inside centralized exchanges.

As crypto markets mature, exchanges will be increasingly judged not only on liquidity and fees, but on:

  • Operational accuracy

  • Risk management

  • Clear incident disclosure


Final Thoughts

The February 2026 Bithumb incident shows how human error and system design can create market shocks even without blockchain failures.

For global observers, the key takeaway is clear:
exchange infrastructure matters as much as the asset itself.


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