In a civil compensation case arising from the accidental issuance of Bitcoin by a South Korean exchange Bithumb, the first trial result has emerged. On August 27th, the Seoul Central District Court ordered one defendant to return approximately 194 million Korean won, ruling that the proceeds from liquidating the mistakenly issued assets constituted unjust enrichment.
First judgment implemented
This case is the first judgment following Bithumb's separate lawsuits against 4 users in March. The exchange claims that these users completed sales after their accounts were mistakenly credited with Bitcoin and still retained the relevant cash even after the platform requested a refund.
The disclosed claim amounts total approximately 714 million Korean won, of which the amount corresponding to this judgment is the second largest. The amounts for the remaining three cases are about 500 million Korean won, 14.8 million Korean won, and 5 million Korean won respectively, and the progress of the court hearings has not yet been made public.
The accident stemmed from the wrong selection of the reward unit.
The incident occurred on February 6th. Bithumb Initially, it was planned to distribute a total of 620,000 Korean won in rewards during a random reward event, but due to an employee's mistake in selecting the payment unit, Bitcoin was chosen instead. As a result, the platform's internal system recorded 620,000 BTC.
These incorrect accounting entries mainly exist within the internal ledger of Bithumb and have not been fully transferred to the Bitcoin blockchain. The scale of these errors far exceeds the actual number of Bitcoins held by the platform. Bithumb subsequently stated that the platform discovered the anomaly about 20 minutes later and began to restrict transactions and withdrawals 15 minutes thereafter, completing the restrictions for 695 users within 35 minutes.
However, some users still sold the mistakenly recorded bitcoins before the restrictions took effect, resulting in the price of BTC / KRW on the Bithumb platform being approximately 17% lower than that of the external market for a period of time.
Regulatory rectification efforts are still underway.
Bithumb Previously, it was reported that the platform had recovered most of the relevant assets through offsetting and voluntary returns by users. Later, the company reported to the South Korean National Assembly that as of March 10, 99% of the initial 1,788 bitcoins that were sold or not recovered had been found, with approximately 7 bitcoins still missing.
In addition to civil litigation, South Korean regulatory authorities also pursued rectification measures after the accident. In April, the Financial Services Commission of South Korea required exchanges to establish an automatic reconciliation mechanism every 5 minutes, and to strengthen multiple approvals for high-risk manual payments, as well as the use of independent accounts, automatic verification, and third-party reviews.
At present, this judgment is still at the first-instance stage, and there is still a possibility of appeal in the future. It is reported that the Financial Services Commission of South Korea issued an inspection opinion to Bithumb at the beginning of August, and the final penalty has not yet been announced.
