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In an unprecedented incident in the cryptocurrency market, South Korea–based digital asset exchange Bithumb announced on Saturday that it had mistakenly distributed more than $44 billion worth of Bitcoin to its users as part of a promotional campaign, triggering a sudden wave of selling on the platform.

The exchange confirmed that it launched an immediate investigation after the error was discovered on Friday, stressing that the incident was not caused by a cyberattack or any external security breach. Bithumb emphasized that customer assets and account management remained fully secure throughout the event. According to the company, it has successfully recovered 99.7% of the 620,000 Bitcoin that were distributed in error, with a total value of approximately $44 billion based on current market prices.

The incident occurred while the exchange was planning to distribute small cash rewards of up to $1.37 per user. However, a malfunction in the distribution system resulted in at least 2,000 Bitcoin being credited to each recipient, sparking panic among users. In response, Bithumb swiftly restricted trading and withdrawals for 695 affected accounts within just 35 minutes of the error.

Bitcoin prices on the exchange reacted sharply, falling by 17% to 81.1 million Korean won on Friday evening, before recovering a significant portion of the losses and closing at 104.5 million won in subsequent sessions.

The incident comes amid intense competition in South Korea’s cryptocurrency market, where Bithumb ranks second behind its major rival Upbit. Market experts say the rare error highlights the critical need for continuous system upgrades and tighter controls over automated reward distribution mechanisms to prevent severe market disruptions.