S Korean Crypto Exchange Tries to Reclaim $5M Accidental BTC Airdrop

Coinnest is asking for its Bitcoins back after a ‘computing error’ resulted in 6 billion Korean won worth of BTC, other cryptocurrencies, and fiat being sent to its users.

South Korean crypto exchange Coinnest suffered a major technical glitch over the weekend, as a result of which a WGT token airdrop event sent out 6 billion won ($5.3 million) worth of Bitcoin, other cryptocurrencies, and fiat to clients instead. The fault was believed to be caused by some sort of issue with the exchange server, according to Coindesk Korea.

Coinnest is reportedly looking into ways of rolling its transaction data back to before the airdrop happened in a bid to restore order to the platform. In the meantime, the exchange has reached out to its clients, asking them to send the erroneously distributed funds back.

So far, the exchange has announced it is still waiting for users to return over half of the cryptocurrencies and fiat and will seek to litigate against those who attempt to withdraw the funds.

“Abnormal transactions can be fully recognized, but the fact that a transaction has been concluded or withdrawn can be regarded as embezzlement or theft," according to a Coinnest official.

Shortly after the airdrop commenced, however, Bitcoin’s price shrank by $50 as a likely result of traders noticing the mistake and quickly selling off their airdropped BTC to make off with the funds.

Some users are seeking compensation for loss of opportunity after the 9-hour server downtime, but Coinnest has thus far refused to issue any form of compensation.

"There are currently no plans to compensate members for transactions caused by computer errors… There are members claiming to have lost opportunity costs due to a 9-hour server check. It is difficult to compensate the damage as realistic as it seems,” the exchange said.

Coinnest will need to work hard to keep traders on side for the rest of 2019, particularly as it still struggles with the fallout of last year’s revelations that CEO Kim Ik-hwan had been arrested for embezzling user money.

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