bitcoin suffered a sudden drop to $55,000 on the South Korean exchange Bithumb this week after what appears to have been a major internal accounting error.
Bithumb mistakenly credited users with 2,000 BTC each instead of a small reward worth 2,000 Korean won (about $1.50), according to a blog post on Friday.
The result was tens of millions of dollars in phantom bitcoins appearing in hundreds of user accounts. No bitcoin was moved on-chain and the inflated balances only existed on Bithumb’s internal ledger.
Users who suddenly saw huge balances wasted little time trying to sell, leading to a sharp sell-off in Bithumb’s BTC/KRW pair, leaving prices 15.8% below other exchanges. At one point, BTC was trading at 81 million won ($55,000), while prices elsewhere remained relatively stable.
Bithumb said it identified the abnormal transactions through internal controls and restricted trading on the affected accounts shortly after the incident.
The exchange said prices on its platform normalized in about five minutes and that its liquidation prevention system worked as intended, preventing any cascading forced liquidations related to the price movement.
The company added that the incident was not related to an external hack or security breach and that customer assets remain safe.
