SEOUL, Feb 7 (Reuters) – South Korea’s cryptocurrency exchange Bithumb said on Saturday it had accidentally given away more than $40 billion bitcoins to customers as promotional rewards, resulting in strong sales on the exchange.

Bithumb apologized for the error, which took place on Friday, and said it had recovered 99.7% of the 620,000 bitcoins, worth about $44 billion at current prices. It had restricted trading and withdrawals for the 695 affected customers within 35 minutes of Friday’s misallocation.

The exchange had planned to distribute small cash rewards of 2,000 Korean won ($1.40) or more to each user as part of a promotional event, but the winners received at least 2,000 bitcoins each, according to media reports.

“We would like to make it clear that this incident is not related to external hacking or security breaches, and that there are ‘no issues with system security or customer asset management,'” Bithumb said in a statement.

But South Korea’s financial regulators, including the Financial Services Commission, said the incident “has exposed the vulnerabilities and risks of virtual assets.”

After an emergency meeting, regulators said in a statement that they would launch an on-site inspection of Bithumb and other crypto exchanges if irregularities are found during reviews of their internal control systems, as well as their holdings and operations of virtual assets.

Bitcoin prices briefly fell 17% to 81.1 million won on Friday evening on Bithumb, the exchange charts. It later recovered and last traded at 104.5 million won.

Bithumb follows Upbit, a dominant player in the South Korean crypto space.

(Reporting by Hyunjoo Jin; Editing by Sam Holmes and William Mallard)