The Seoul Central District Court ruled in favor of the cryptocurrency exchange Bithumb on August 26 and 27 in two lawsuits against users who sold erroneously credited bitcoins and refused to return the proceeds. This is an important precedent for the South Korean jurisdiction, highlighting the legal liability of recipients of improperly credited assets.
In the first case, the claim amount was 5 million won (about $3,600), and in the second — 194 million won ($140,000). Two more proceedings for 14.8 million won ($10,700) and 500 million won ($362,000) remain pending. The exchange insists on the return of funds as unjust enrichment — a key legal mechanism that, judging by the initial rulings, works in favor of the platform.
A $40 Billion Error: Timeline of the Incident
The root of the problem dates back to February 2026, when Bithumb planned to distribute 620,000 won among 249 clients during a promotional campaign. However, an employee confused the payment units, specifying BTC instead of the Korean currency. As a result, 620,000 BTC with a nominal value exceeding $40 billion appeared on users' internal balances — an amount many times greater than the exchange's actual reserves.
The error was discovered approximately 20 minutes later, after which trading and withdrawals on the affected accounts were blocked. But some recipients managed to sell the coins, triggering a sharp drop in the price of bitcoin on the platform. According to financial authorities, before the transactions were completed, Bithumb recovered 618,214 BTC (99.7% of the erroneous amount), while 1,786 BTC were sold. The platform later reported recovering approximately 93% of that volume.
Regulatory Consequences and New Standards
The incident triggered tighter oversight in the South Korean crypto industry. The Financial Supervisory Service (FSS) launched a full-scale investigation, and in April the Financial Services Commission (FSC) introduced new requirements: exchanges must implement automated reconciliation of client balances with actual reserves every five minutes. For operations involving manual input, including promotional campaigns, multi-level confirmation and account segregation are now required.
The investigation into Bithumb itself has moved to the next phase: the FSS sent the exchange a report on the inspection results and began the procedure for possible sanctions. Notably, amid these events, Bithumb continues preparations for an IPO scheduled for 2028.
My analysis: The court victories are not only protection of Bithumb's financial interests but also a signal to the market: South Korean regulators and courts are ready to firmly curb attempts to profit from technical glitches. However, a far more significant consequence will be the strengthening of audit and control in the industry, which in the long term will increase institutional investors' confidence in local platforms.