As Bithumb, Korea's No. 2 virtual asset exchange, mistakenly paid customers a Bitcoin amount worth 62 trillion won, some said that if the payment cancellation had been delayed, it could have followed the path of FTX in the United States, once the world's No. 4 exchange, which went bankrupt in 2022. FTX did not actually hold the amount of virtual assets circulating on its exchange and went bankrupt after a large-scale withdrawal crisis (bank run) occurred.
On the 6th at 7 p.m., Bithumb paid 620,000 Bitcoins to 249 winners of an event. An employee who intended to pay winners 2,000 to 50,000 won mistakenly entered "Bitcoin" instead of "won."
About 35 minutes after paying out 620,000 Bitcoins, Bithumb canceled 618,212 of them (99.7%). However, 1,788 were transacted in the meantime. Determining it could not unilaterally void transactions executed before the cancellation, Bithumb purchased 1,788 Bitcoins to match the quantity.
On centralized exchanges (CEX, Centralized Exchange) like Bithumb, when customers transact virtual assets, the movement of virtual assets does not occur in real time, and only the transaction history is reflected in internal ledgers. Bithumb reconciles its ledger entries with actual balances once a day.
If the cancellation had been delayed and the erroneously paid 620,000 Bitcoins had been transacted or withdrawn to overseas exchanges, Bithumb would have had to purchase 620,000 Bitcoins and pay customers to reconcile its ledger and balances. If it failed to purchase the full amount of Bitcoin, the ledger and balances would not match, and Bithumb would likely have found it effectively difficult to continue operations due to sanctions from the financial authorities.
Purchasing 620,000 Bitcoins would require about 64 trillion won at the current price, about 16 times the total assets of Bithumb Holdings, the largest shareholder of Bithumb Korea, at the end of 2024 (about 3.87 trillion won). If distrust of Bithumb grew, a bank run in which customers cash out assets all at once could have occurred.
FTX used customer deposits to cover losses at its affiliate or for investment and repayment. As the quantity of virtual assets circulating on the exchange did not match the amount actually held, anxiety spread that FTX could not return virtual assets, triggering a bank run, and FTX tried to respond by raising funds from outside but failed.
Under the Virtual Asset User Protection Act (virtual asset phase 1 law), exchanges must hold the same type and quantity of virtual assets as those entrusted by users. Failure to comply is subject to fines of up to 100 million won.
A financial authorities official said, "Actually holding the virtual assets entrusted is fundamental for an exchange, and if it cannot comply, operations will likely be difficult," adding, "(If 620,000 Bitcoins had been transacted) the exchange would have to make up for it, and if it cannot recover them, it must take responsibility."