On the 7th, the financial authorities took emergency action in response to a large amount of bitcoin being wrongly paid out at the domestic virtual asset exchange Bithumb.
On the day, the Financial Services Commission held an emergency review meeting at Government Complex Seoul, chaired by Vice Chair Kwon Dae-young of the Financial Services Commission (FSC), together with the Financial Supervisory Service (FSS) and the Financial Intelligence Unit (FIU). Bithumb CEO Lee Jae-won also attended the meeting.
Vice Chair Kwon said, "We view this incident sternly as a case exposing the vulnerabilities and risks of virtual assets," and asked the FSS to identify the status of user damage and to monitor Bithumb's prompt implementation of compensation measures.
The Financial Services Commission (FSC) formed an emergency response team with the FIU, the Financial Supervisory Service (FSS), and the Digital Asset eXchange Alliance (DAXA) for follow-up measures on this incident.
After inspecting Bithumb, the emergency response team decided to examine other exchanges as well for their virtual asset holdings and operations and their internal control systems. If any legal violations are found during the inspection, the FSS will immediately switch to an on-site examination.
If necessary, it also plans to pursue system improvements that can closely monitor exchanges' virtual asset holdings.
The Financial Services Commission (FSC) said it will also push institutional improvements in connection with phase 2 virtual asset legislation, for which the government plan is currently being prepared.
It plans to require virtual asset service providers to undergo periodic inspections of their virtual asset holdings by external institutions and to promote measures that would stipulate no-fault liability for virtual asset service providers when users suffer damage due to system failures.
Earlier, on the morning of the day, the Financial Supervisory Service (FSS) held an emergency response meeting chaired by Governor Lee Chan-jin and immediately dispatched an on-site inspection team. On-site, it is identifying the cause of the incident, Bithumb's user protection measures, the possibility of recovering the wrongly paid bitcoin, and any legal violations.
Bithumb is known to have attempted to pay prize money to participating users through its in-house "random box" event on the evening of the previous day, but an employee mistakenly entered "bitcoin" instead of "won" as the unit. A total of 620,000 won, which was to be paid to 249 people, was wrongly paid as 620,000 bitcoins.
Bithumb said it immediately recovered most of the wrongly paid bitcoin, but has not yet recovered won and virtual assets equivalent to about 125 bitcoins.