New Statement from the Cryptocurrency Exchange That Made a Big Mistake and Caused Bitcoin Prices to Fall – Binance Founder CZ Also Spoke

South Korea’s second-largest cryptocurrency exchange, Bithumb, said a total of 620,000 Bitcoin was sent to 695 users because an operational error occurred during the event reward distribution.

But, compared to previous estimates of 2,000 $BTC in the market, the scale of the wrong distribution was much larger.

Exchange management said it froze transactions and withdrawals for the 695 accounts involved within 35 minutes of finding out that the overpayment was inflicted. 618,212 $BTC (999) – the statement said. Seventy percent of the 620,000 $BTC total was returned to 7%) who were s. Furthermore it was said that 93% of the assets related to the 1,788 $BTC sold were re-owned. The firm stated that the portion of unrecovered revenue would be ‘paid by its own resources’, and that “advancement distribution processes” will be revamped to prevent another similar incident from repeating itself.

Also, Bithumb argued that this incident stemmed from “an internal accounting mistake,” not an on-chain move.” A large number of user accounts were referred to as ‘ghost balances’, which means that they had no real counterpart on the blockchain. Therefore, while some users triggered short-term price fluctuations due to selling, no large on-chain $BTC transfers occurred.

Changpeng Zhao (CZ), in a statement about the incident, stated that they offered support but small to recover from the accident. Initially, I didn’t share anything to prevent spreading FUD, CZ said ‘I don’T want to spread it. There was a $134 million human error, rather than 1340 million for the same reason. Maximum value checks should be checked for all airdrop features. CZ also said it was not clear whether such security checks were applied to all portfolio projects.

Bithumb’s incorrect distribution of 620,000 $BTC – around 22% – is the mistaken one for . crypto, with widespread repercussions on the crypto community that 95% of all bitcoin supply has been from to Bitcoin. The exchange managed 42,619 $BTC at the end of last year’s third quarter (along with previous reports in South Korean media) according to earlier reports. Its 620,000 $BTC was not a real on-chain asset transfer but just an internal accounting error, this suggests.

Most centralized exchanges (CEXs) do not process user balances on-chain in real time; they are stored by internal databases. Generally, on-chain transactions are done only for withdrawals (i.e On- Chain Transactions). Despite this structure providing operational efficiency, the Bithumb example has shown that weaknesses in internal control mechanisms can cause serious market fluctuations.

After that, South Korean regulators were said to have investigated the incident; Bithumb vowed “to strengthen its internal control systems and implement multi-layered verification mechanisms in its reward distribution processes.”

*This is not investment advice.

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