South Korea Probes Bithumb Over 60 Trillion Won Bitcoin Payout Error

VADODARA, February 7, 2026 — South Korean financial authorities have initiated an on-site inspection of cryptocurrency exchange Bithumb. This action follows a catastrophic Bitcoin mispayment incident valued at approximately 60 trillion won. The latest crypto news highlights a severe operational failure that temporarily flooded the market with unintended supply. According to The Hankyoreh, an official stated authorities are treating the matter with utmost seriousness due to the massive scale of damages.

Investigation: A Systemic Error Unfolds

The incident occurred on February 6, 2026, around 10:00 a.m. UTC. A Bithumb employee, while distributing event prizes worth between 2,000 and 50,000 won to 695 customers, mistakenly entered the payment unit as Bitcoin (BTC) instead of the Korean won. This error resulted in users receiving a minimum of 2,000 BTC each. Market structure suggests this created an immediate, artificial supply shock on Bithumb's order book. Consequently, the price of BTC on the exchange plummeted as recipients likely rushed to sell.

Bithumb responded by immediately blocking trading and withdrawals for the affected accounts. The exchange has since recovered 618,212 BTC, representing 99.7% of the misallocated funds. However, the remaining 0.3%—approximately 1,858 BTC—remains unaccounted for, raising questions about final settlement and potential market leakage. On-chain data indicates unusual transaction volumes from Bithumb-controlled addresses during the recovery window.

Market Context & Historical Precedent

This event mirrors past exchange failures but on a different scale. Historically, operational errors of this magnitude—like the 2014 Mt. Gox collapse—have precipitated prolonged bear markets and regulatory crackdowns. In contrast, Bithumb's rapid recovery of most funds may mitigate systemic contagion. Underlying this trend is a persistent vulnerability in centralized exchange (CEX) infrastructure to human and software error.

, this incident occurs amid broader market stress. The global crypto sentiment index sits at "Extreme Fear" with a score of 6/100. This event likely contributed to the 8.47% 24-hour decline in Bitcoin's price, compounding existing negative momentum. Related developments include significant futures liquidations exceeding $520 million and analysis linking Bitcoin's plunge to institutional hedging strategies.

Technical Architecture & Price Action

The mispayment created a massive Fair Value Gap (FVG) on Bithumb's internal ledger. Market structure suggests the sudden sell-off from recipients formed a clear bearish order block around the $71,000 level. Bitcoin's current price of $71,051 is testing this zone as resistance. A critical Fibonacci support level at $68,500 (the 0.618 retracement from the recent high) now acts as a key technical floor.

Volume profile analysis shows abnormally high selling volume concentrated in a short timeframe, typical of a liquidity grab. The Relative Strength Index (RSI) on daily charts is approaching oversold territory, but the 50-day moving average is sloping downward, indicating bearish momentum. This technical setup is reminiscent of the flash crash dynamics observed during the 2021 China mining ban.

By The Numbers

Why It Matters

This incident matters because it exposes a critical fault line in centralized crypto infrastructure. A single data entry error triggered a multi-billion dollar market disturbance. Real-world evidence shows that despite advanced trading engines, human error remains a systemic risk. Institutional liquidity cycles may now factor in "exchange operational risk" premiums, potentially increasing borrowing costs for large players.

Retail market structure is also impacted. The rapid price plunge on Bithumb likely triggered stop-loss orders and margin calls across connected platforms. This creates a cascade effect, amplifying volatility. The event the importance of robust internal controls, a point emphasized in guidance from international bodies like the Financial Action Task Force (FATF).

Expert Commentary

"The Bithumb incident is a stark reminder that operational risk is the silent killer in crypto markets. While 99.7% recovery sounds efficient, the 0.3% leakage and the price impact reveal deep-seated vulnerabilities. Market participants should scrutinize exchange proof-of-reserves more aggressively," stated the CoinMarketBuzz Intelligence Desk.

Market Outlook & Price Scenarios

Market structure suggests two primary scenarios based on the current technical setup and regulatory overhang.

• Bullish Invalidation Level: $73,500. A sustained break above this resistance, which aligns with the pre-incident consolidation zone, would invalidate the bearish narrative and suggest the sell-off was fully absorbed.
• Bearish Invalidation Level: $68,500. This Fibonacci support level must hold to prevent a deeper correction toward the $65,000 range, where significant long-term holder cost basis resides.

The 12-month institutional outlook now incorporates heightened regulatory scrutiny in South Korea. Authorities may impose stricter capital and operational requirements, potentially reducing market-making liquidity. This aligns with a broader 5-year horizon where regulatory clarity increases but operational hurdles for exchanges rise, possibly benefiting decentralized finance (DeFi) alternatives.