Bithumb Fixes Bitcoin Reward Error as Market Volatility Tests Crypto Exchanges

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• Bithumb recovered 99.7% of excess Bitcoin and covered remaining losses with company funds
• The incident was not a hack and caused only brief market disruption
• Exchange reliability is under pressure as Bitcoin trades amid macro-driven volatility

South Korean cryptocurrency exchange Bithumb says it has fully resolved a system error that briefly credited some users with excess Bitcoin, an incident that unfolded during a period of heightened market volatility for the world’s largest digital asset.

In a statement released Sunday, Bithumb confirmed it recovered 99.7% of the mistakenly credited Bitcoin on the same day. The remaining portion — about 1,788 BTC that had already been sold — was reimbursed using company funds to ensure customer balances remained intact.

The exchange emphasized that no customer assets were lost and that deposits and withdrawals continued normally throughout the incident.

What Happened During the Bithumb Bitcoin Error

The issue occurred during a promotional event on Friday, when a system malfunction credited certain accounts with unusually large Bitcoin balances. Some recipients quickly sold the funds, triggering sharp but brief price swings on the exchange.

Bithumb said it restricted affected accounts within minutes, stabilizing trading before the issue could escalate into broader liquidations. The exchange stressed that the incident was not related to hacking or external security breaches.

According to the company, all virtual asset holdings now meet or exceed total user deposits.

Compensation Measures for Affected Users

To address disruptions caused by the error, Bithumb announced several compensation steps:

• Users logged in at the time of the incident will receive 20,000 Korean won (about $15)
• Traders who sold Bitcoin at unfavorable prices will receive full reimbursement plus an extra 10% payout
• Trading fees will be waived across all markets for seven days

The exchange did not disclose the total Bitcoin amount involved, though some users estimated it was close to 2,000 BTC.

Also read: Bitcoin Whales Hit Nine-Month Low Supply Share as Miners and Markets Slide

Exchange Errors Meet a Fragile Bitcoin Market

The timing of the incident comes as Bitcoin trades under renewed pressure. The asset has fallen more than 22% over the past month, slipping below $70,000 as investors reduce exposure to liquid assets amid broader macro uncertainty.

Bitwise CEO Hunter Horsley recently described Bitcoin as being “swept up” alongside traditional markets, even as institutional demand remains strong. Bitwise reported over $100 million in inflows in a single day, while BlackRock’s spot Bitcoin ETF also saw renewed capital inflows.

A Broader Pattern for Centralized Exchanges

Bithumb’s incident follows a string of operational challenges across major centralized exchanges. Coinbase recently acknowledged account restriction issues, while Binance distributed hundreds of millions in compensation after technical problems during a volatile sell-off last year.

Together, these events highlight how operational resilience is becoming as critical as liquidity during periods of extreme market stress.

While Bithumb’s rapid recovery and compensation response helped limit damage, the episode underscores the fragility of exchange systems during volatile market conditions. As Bitcoin continues to trade in lockstep with global macro assets, even brief technical failures can amplify uncertainty — making transparency and swift remediation essential for maintaining user trust.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.