Bithumb’s $44B Bitcoin Error Highlights Structural Failures in Centralized Exchange Design
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Bithumb’s $44B Bitcoin Error Highlights Structural Failures in Centralized Exchange Design
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About this listen
This story was originally published on HackerNoon at: https://hackernoon.com/bithumbs-$44b-bitcoin-error-highlights-structural-failures-in-centralized-exchange-design.
Bithumb accidentally created $44B in Bitcoin that didn't exist. Users traded it for 20 minutes. Here's what that reveals about every crypto exchange.
Check more stories related to web3 at: https://hackernoon.com/c/web3. You can also check exclusive content about #bitcoin, #bithumb-bitcoin-glitch, #crypto-exchanges, #bithumb-phantom-bitcoin, #proof-of-reserves, #internal-ledger-risk, #cex-structural-issues, #hackernoon-top-story, and more.
This story was written by: @niteshpadghan. Learn more about this writer by checking @niteshpadghan's about page, and for more stories, please visit hackernoon.com.
Bithumb accidentally credited 620,000 Bitcoin ($44B) to 695 users during a promotional campaign meant to distribute $1.37 each. For 20 minutes, users traded phantom Bitcoin that only existed in Bithumb's internal ledger, not on the blockchain. The incident exposed a structural flaw: centralized exchanges can create balances without on-chain backing, and Proof of Reserves can't stop it.