South Korean Regulator Says Bithumb's Bitcoin Misfire Incident Exposes Systemic Risks; Users Who Sold the Related Bitcoin Are Legally Obligated to Return It

Odaily News: The Financial Supervisory Service (FSS) of South Korea stated that the recent Bitcoin misfire incident at Bithumb highlights the systemic vulnerabilities in the crypto asset sector, indicating a need to further strengthen regulatory rules. FSS Governor Lee Chan-jin pointed out at a press conference that the incident reflects structural issues in virtual asset electronic systems. Regulatory authorities are conducting a focused review on this matter and will incorporate the related risks into subsequent legislative considerations to promote the inclusion of digital assets into a more comprehensive regulatory framework.

Reports indicate that Bithumb previously mistakenly distributed Bitcoin worth over $4 billion to users during a promotional event, triggering a brief sell-off on the exchange. Preliminary investigations by regulators show that approximately 99.7% of the roughly 620,000 mistakenly distributed Bitcoins have been recovered. Of the approximately 1,786 Bitcoins that were sold, about 93% have been reclaimed. The FSS also stated that users who sold the related Bitcoin are legally obligated to return it.

Furthermore, Lee Chan-jin mentioned that before discussing policies such as launching a Bitcoin spot ETF, fundamental issues like "ghost coins" need to be addressed first, and market stability must be ensured. The South Korean government had already enacted the "Virtual Asset User Protection Act" in July 2024 and plans to expand the regulatory scope for digital assets through further legislation. (Reuters)