Bithumb Bitcoin Error Triggers Flash Crash After Free BTC Payout

Bithumb Bitcoin Error Crashes Local BTC Price as Accounts Freeze

The crypto world saw a massive shock on February 6, 2026. A major Bithumb Bitcoin error led to an accidental internal credit totalling up to 620,000 BTC, according to exchange disclosures. This huge mistake happened during a routine marketing event. 

Source: X(formerly Twitter)

Bithumb meant to send small cash prizes of 2,000 Korean won (about $1.40). Instead, an employee chose "Bitcoin" as the currency unit. This meant users received 2,000 BTC each. At the time, this put about $44 billion into user accounts by mistake.

Why the Bithumb Bitcoin Error Caused a Price Crash

The Bithumb Bitcoin error caused prices to fall very fast. When users saw thousands of Bitcoin in their accounts, they tried to sell them right away. This massive sell-off crashed the price on the Bithumb platform. Within minutes, Bitcoin fell 17% to 81 million won (about $55,000). At the same time, global prices on other exchanges stayed steady near $66,000. This created a rare "reverse Kimchi premium" in South Korea.

The South Korean platform acted quickly to stop the damage. Their security systems flagged the odd trades within five minutes. The exchange then froze the 695 affected accounts. They also paused all withdrawals to keep the assets safe. This helped protect the exchange from a total loss. By the next day, The South Korean platform reported that they recovered 99.7% of the missing coins.

The Details of the $44 Billion Glitch

The exchange error is one of the biggest mistakes in history. Even though the coins were only on an internal list, the impact was real. Many traders who saw the low price tried to buy more, but the system was already frozen.

While The South Korean platform recovered most of the funds, about $2.2 million was withdrawn before the freeze. Bithumb is now working with the police to get those funds back. This event shows that even big exchanges can make simple mistakes that lead to huge risks.

Expert Analysis: A Lesson for 2026 Markets

From a news perspective, this exchange error shows that human error is still a big threat. As crypto moves into 2026, safety rules must improve. Experts suggest that exchanges should have a "second check" for all large payouts. This would stop one person from making a multi-billion dollar mistake.

South Korean regulators are now looking at Bithumb’s internal rules. They want to make sure this never happens again. For now, the market is back to normal, but the event will be remembered as a major wake-up call for the industry. Looking ahead, similar incidents may accelerate automated safeguards and dual-approval systems across centralized exchanges, particularly in jurisdictions like South Korea where retail participation dominates trading volume.

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This content is provided for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency investments involve risk, and readers should conduct independent research before making decisions.