South Korea’s Bithumb Seeks Court Freeze on $8 Million in Bitcoin Assets After Payout Error
Bithumb, South Korea’s second-largest cryptocurrency exchange, planned to distribute a combined 620,000 won to 249 winners in a promotion on Feb. 6, 2026. An employee mistakenly entered BTC instead of KRW as the currency, crediting accounts with 620,000 Bitcoin worth more than $40 billion on paper. The incident highlighted risks involving centralized exchanges’ internal ledgers, asset reserves and controls over manual processes.
Bithumb recovered 99.7% of the mistakenly credited assets that day and used company reserves to cover the 1,788 BTC that had already been sold. After pursuing recipients individually, it reduced the outstanding amount from about 12.3 billion won ($8.3 million) to 7 Bitcoin. On April 9, 2026, the company confirmed that it had petitioned a South Korean court for a provisional asset freeze against those refusing to return the funds, with civil lawsuits expected to follow.
All Coverage
2 original reportsThe Backstory
The history behind this eventSouth Korea Fines Crypto Exchange Bithumb $136,000 Over Overseas Data Transfers
Bithumb is one of South Korea's major cryptocurrency exchanges. Although it must provide certain user data to overseas platforms when transferring virtual assets across borders, it is still required to obtain separate consent from the individuals concerned under the Personal Information Protection Act. The case underscores that anti-money-laundering requirements do not override individuals' control over their personal data and sets compliance boundaries for exchanges' cross-border data processing.
South Korea's Personal Information Protection Commission announced its findings on June 25, 2026, and fined Bithumb 183.8 million won, or about $136,000. From September to November 2025, Bithumb shared a USDT ledger with BingX and also transmitted user data to 13 overseas exchanges without obtaining separate consent for cross-border transfers.
South Korean Police Lose $1.4 Million in Seized Bitcoin; Two Suspects Arrested
In 2021, South Korea’s Gyeonggi Northern Provincial Police Agency seized 22 Bitcoin while investigating the hacking of a cryptocurrency exchange and placed them in a cold wallet managed by a third party. Police breached rules governing seized assets and did not possess the wallet’s seed phrase, creating significant risks for the custody and recovery of the evidence.
South Korean police recently confirmed that the 22 Bitcoin had been stolen, with related reports valuing them at about $1.4 million. The Gyeonggi Northern Provincial Police Agency has arrested two suspects and is investigating when and how the assets were transferred and where the funds went. It is also working to determine responsibility for the third-party management and internal custody of the assets.
Subscribe to Mark Radar Weekly
Every Friday, the week's strongest signals in your inbox. Unsubscribe anytime.