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South Korea launches probe Into Bithumb after $43B “fat-finger” Bitcoin blunder

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South Korea launches probe Into Bithumb after $43B “fat-finger” Bitcoin blunder

South Korea’s Financial Supervisory Service (FSS) has escalated scrutiny of major cryptocurrency exchange Bithumb following an unprecedented operational mistake in which the firm accidentally credited customers with tens of billions of dollars’ worth of Bitcoin.

Summary

  • South Korea’s Financial Supervisory Service (FSS) has launched a full-scale investigation into Bithumb following a massive $43 billion Bitcoin “fat-finger” error.
  • The incident stemmed from an internal operational mistake that temporarily credited users with Bitcoin far exceeding the exchange’s actual holdings.
  • Regulators are examining Bithumb’s internal controls and IT systems, with potential penalties possible if violations are confirmed.

The investigation follows a striking error on February 6, 2026, when Bithumb, during a routine promotional event, inadvertently distributed 620,000 Bitcoin, worth roughly $40 billion to $44 billion at market prices, to users instead of the intended small cash rewards.

The mishap stemmed from an employee inputting payouts in Bitcoin (BTC) units rather than Korean won, leading to an explosion of overissued Bitcoin credits before the mistake was detected.

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What happened in the Bithumb mistake

In a “Random Box” promotion designed to reward users with modest cash amounts, Bithumb’s payout system mistakenly issued Bitcoin due to a unit entry error, resulting in the colossal overshoot.

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Within minutes, hundreds of users found massive sums of Bitcoin in their accounts, equivalent to 13–14 times Bithumb’s actual BTC holdings based on industry estimates.

The exchange acted swiftly to freeze affected accounts and block trading and withdrawals within about 35 minutes, recovering the vast majority of the missent tokens. Still, a small portion, representing millions in value, was sold or withdrawn before the controls took effect.

FSS investigation and regulatory response

Initially launching an emergency review, the FSS escalated its examination to a full-scale formal investigation. Bithumb was notified of the probe signalling a deep dive into what went wrong and whether internal controls violated the Virtual Asset User Protection Act or other regulatory standards.

FSS Governor Lee Chan-jin has emphasized that the episode revealed systemic weaknesses in internal control and electronic ledger systems at the exchange. Regulators are examining how an exchange with far fewer actual reserves was able to record and disburse phantom Bitcoin balances so rapidly.

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Depending on what investigators find, the probe could lead to sanctions against Bithumb, including fines or even suspension of operations if negligence or legal violations are confirmed. The FSS has also noted that users who sold erroneously credited Bitcoin may be legally obligated to return it as unjust enrichment under current interpretations of Korean law.

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Crypto World

Eight Sleep Secures $50M in Funding to Build AI Sleep Agents

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Stablecoin firm Tether has led a $50 million strategic investment round in sleep technology startup Eight Sleep, to help the company integrate artificial intelligence agents into its sleep tech products.    

The latest funding round was announced on Tuesday, with Eight Sleep raising $50 million at a $1.5 billion valuation. It follows a $100 million raise last August. The firm specializes in sleep health products, primarily across bedding and supplements.

In an announcement on Tuesday, Tether expressed its strong conviction in health technology to support “longevity, performance, and disease prevention,” and will collaborate with Eight Sleep to bring artificial intelligence-based health technology products to market.

​Tether has been using its capital stockpile to invest in a wide range of areas outside crypto. Its investments span the gold sector, media, biotechnology and AI. The firm has also made multiple attempts to buy professional football clubs.

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Source: Matteo Franceschetti

“Technologies that can turn continuous health data into clear, practical insights will shape the future of consumer health and wellness,” Tether said.

“The investment is designed to empower Eight Sleep and establish a long-term collaboration to build advanced AI-driven health technology using, among others, Tether’s QVAC architecture and leveraging QVAC’s edge intelligence to enhance Eight Sleep products,” it added.

Tether’s QVAC is a privacy-focused health tech service launched in December that enables users to integrate their bio-health data from multiple services or products, like smart rings, into a single platform, supported by local on-device AI to help users with data management and health insights.  

Eight Sleep has stated that it plans to build a sleep-focused AI agent to support its Pod, a sleep tech product that automatically adjusts bed temperature, elevation, and sound based on factors such as heart rate, breathing, snoring, time asleep and sleep stages.

​Related: Stablecoin giving grows as ‘crypto philanthropy’ matures: Report

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​The Pod already has AI integrations to track sleep health data; however, Eight Sleep has said the funding will help evolve the company’s current AI tools and capabilities.

“We’ve built the most seamless AI-powered health sensing system in the world, and this partnership with Tether gives us the infrastructure to take that intelligence beyond the Pod, into every aspect of personal health,” noted Franceschetti as part of Tether’s announcement.