One of the largest houses in cryptocurrency exchange from South Korea wanted to reward its users with a symbolic promotion for their operations. However, a mistake has made the promotion of the company on everyone’s lips today…and not exactly for the better.
For a few minutes, several hundred customers Bithumb They saw their accounts filled with bitcoins worth several billion dollars. What should have been a small promotional prize turned into a mistake that, on his screen, became billionaires to normal users.
A conversion error. Bithumb’s original idea was to offer a reward of 2,000 won (approximately $1.37 in exchange) to users who participated in a company promotional event. The equivalent of a welcome coupon for newcomers. The problem came when, instead of sending that small amount in won, the system ended up sending bitcoins to the accounts of the new clients.
According to published the BBCthe failure occurred when an employee entered the indicator “BTC” in the payment field instead of “Korean won”, so the platform executed the reward in cryptocurrencies instead of local currency. That simple misplaced piece of information led the company to mistakenly transfer some 620,000 bitcoins, a figure that, at current prices, is around $44 billion.
A mistake that destabilized the market. Bithumb estimated that about 249 users of its platform received bitcoins by mistake and the failure affected about 695 clients who operated on the platform.
It is estimated+ that, on average, each user was assigned about 2,490 bitcoins, which represents a value of around 144 million euros. Seeing the new balance of bitcoins in their account, several of these new “accident millionaires” rushed to sell, generating an avalanche of orders that caused the price of bitcoin to fall within Bithumb itself. about 10% in a matter of minutes.
Bithumb hit the panic button. When the company realized the error, it began to apply restrictions to affected clients, temporarily limiting operations and withdrawals to stop the leak of funds.
In its assessment of the incident, Bithumb assures which managed to recover approximately 99.7% of the 620,000 bitcoins that were left by mistake, which would leave about 125 bitcoins still pending recovery. The company also points out that what has already been recovered includes some 1,663 bitcoins that users they managed to sell before the platform’s “panic button” was pressed, which activated transaction blocks. Lee Jae-won, the company’s executive director, assured that the company will take the incident as a lesson and will prioritize “customer trust and peace of mind” over external growth.
“Paper” Bitcoin. The case has reopened the debate about the so-called “paper bitcoin”, in reference to those transactions that exist within the internal systems of the exchanges but do not always have the real assets that support them behind them.
The sum of bitcoins that suddenly appeared in the accounts far exceeds the $5.3 billion in bitcoin assets that Bithumb claims to be in custody, making it clear to what extent much of that “wealth” was only on paper in its internal books.
It’s not the first time it happens. It is not the first time that a banking or financial entity makes its users millionaires in a “magical” way. He Financial Times counted a few days ago how Citibank made one of its clients a billionaire by transfer 81 billion dollars when he intended to send him a payment of $280.
As happened with the South Korean bitcoin exchange, the bank realized the error and fixed it (unfortunately for the user) in 90 minutes. However, the simple fact that a human error when indicating a figure or inserting the type of currency can shake the entire bitcoin market has set off alarms in the South Korean Financial Supervisory Service, which has announced reviews and does not rule out opening formal investigations if they detect serious failures in internal controls or signs of illegal activity.
Image | Unsplash (Michael Fortsch)
GIPHY App Key not set. Please check settings