South Korean lawmakers are demanding accountability from financial regulators after a massive system failure at Bithumb, the nation's largest crypto exchange, resulted in the erroneous distribution of over $43 billion in Bitcoin.
The incident on February 6 has sparked intense political scrutiny of Bithumb and the agencies tasked with overseeing the virtual asset market.
Members of the National Assembly are questioning how such a significant error went undetected despite multiple regulatory inspections. Reports indicate that Bithumb underwent three reviews between 2022 and 2025, with the Financial Supervisory Service conducting three inspections during the same period. Regulators reportedly failed to identify a critical structural weakness in the exchange's system that allowed a single employee to initiate massive coin transfers.
Lawmakers argue that existing oversight mechanisms are insufficient, highlighting a lack of safeguards against such errors. The exchange mistakenly credited users with 2,000 Bitcoin each, instead of the intended 2,000 won (approximately $1.38), totaling 620,000 Bitcoin in incorrect distributions.
In response, the Financial Supervisory Service has extended its investigation deadline to focus on investor protection and anti-money laundering compliance. Authorities have also formed an emergency response team with the Digital Asset eXchange Alliance (DAXA) to inspect internal control systems at other major domestic exchanges. The findings are expected to shape future cryptocurrency legislation in South Korea.