Bithumb Incident May Affect CEX Business Eligibility, Korean Regulators to Conduct Industry-wide Investigation into "Phantom Bitcoin" Situation

BlockBeats News, February 9th. According to newspim, Eun Sung-soo, the head of the Financial Supervisory Service in South Korea, expressed concerns about the Bithumb mistaken transfer incident, calling it a "disaster." He mentioned the need for a large-scale investigation into so-called "book transaction" involving virtual assets that were not actually held and to develop countermeasures.

He particularly pointed out that if there is confirmed illegal conduct on the part of Bithumb, all possible measures under current law will be taken. He also mentioned that after the potential passage of the upcoming Digital Assets Basic Law, regulatory actions at a licensing level might even be implemented, posing a threat to the virtual asset trading platform industry itself.

Speaking at the "2026 Major Business Plan Briefing" held at the Seoul Financial Supervisory Service headquarters, Eun Sung-soo stated: "After receiving reports of the Bithumb mistaken transfer incident, we have begun an on-site inspection and plan to escalate it to a formal investigation if illegal suspicions are confirmed. This is a serious situation that shakes the credibility of the virtual asset trading platform itself."

Eun Sung-soo emphasized regarding this incident: "The biggest problem is that Bithumb traded a 'virtual' currency it did not actually hold, which is an event that undermines the credibility of the entire virtual asset trading platform. We are also looking into the current status of other trading platforms. This is an area that must be improved."

As of September last year, Bithumb held only 175 of the bitcoins, while customer entrusted holdings were 42,619, totaling 42,794. Considering the bitcoins involved in the mistaken transfer were as high as 620,000 coins, more than 14 times its holding, this means the equivalent of around 580,000 "ghost" bitcoins were sent out.

This situation was possible because bitcoin transactions did not actually occur on the blockchain but rather initially only changed digits on the exchange's internal ledger, known as a "book transaction" structure. This structure aims to achieve fast transactions and save on fees; book transactions themselves are not illegal. The issue lies in Bithumb not establishing a security mechanism to prevent the transfer of non-existent virtual assets.