TLDR
- Bithumb announced compensation for users affected by a 100-minute outage that disrupted trading on Tuesday night.
- The outage left users unable to execute low-limit buy orders or cancel low-limit sell orders.
- Bithumb followed the Korea Digital Asset Exchange Alliance’s guidelines to determine compensation for affected customers.
- The exchange did not disclose the technical details behind the outage due to security concerns.
- Bithumb has faced numerous technical failures, with 41 reported outages between 2018 and 2024.
Bithumb, a major South Korean cryptocurrency exchange, announced compensation for users affected by a 100-minute outage on Tuesday night. The disruption began around 9:40 p.m. local time and lasted for over an hour, leaving users unable to trade or modify orders. In response to the incident, Bithumb stated it would follow the Korea Digital Asset Exchange Alliance’s guidelines for compensating affected customers.
Compensation Plan for Affected Users
Bithumb confirmed that it would compensate users who encountered unexecuted low-limit buy orders and failed cancellation attempts of low-limit sell orders. These issues may have led to unintended transactions, impacting users’ trading activities. “We are working to ensure fair compensation for everyone affected by this service disruption,” a Bithumb spokesperson said.
The exchange clarified that it would assess the damage according to established protocols. It emphasized that emergency maintenance procedures were completed, resolving the technical issues. However, the platform has not disclosed further details about the cause of the outage, citing internal security concerns.
Recurring Outages and Ongoing Concerns
The outage is not the first time Bithumb has faced technical disruptions. Data from lawmaker Lee Hun-seung revealed that Bithumb reported 41 outages out of 89 technical failures by South Korea’s five major crypto exchanges between 2018 and 2024. The exchange paid around 660 million won in compensation, accounting for a significant portion of the total compensation pool.
This recurring issue has drawn criticism from South Korean lawmakers and industry analysts. There have been ongoing calls for tighter regulations to ensure that exchanges like Bithumb adhere to stricter standards. However, crypto exchanges in Korea are still not required to compensate users for technical failures in the same way securities firms are.
Bithumb Faces Growing Criticism
In addition to technical outages, Bithumb has faced security concerns and legal controversies. Earlier this year, Bithumb users were impacted by a data breach at SK Telecom, prompting the exchange to strengthen its security measures. While the breach did not directly affect Bithumb, the incident caused alarm among its users.
Moreover, Bithumb recently came under scrutiny for allegedly using “dark patterns” to mislead users about trading fees. The accusations suggested that the exchange earned over 140 billion won in extra charges from users. These allegations triggered intervention from the South Korea Fair Trade Commission and the Financial Services Commission.
Despite its ongoing challenges, Bithumb has worked to recover financially. It reported over 130 billion won in operating profit last year. However, the exchange’s reputation continues to suffer due to these repeated technical issues and legal disputes.
