Rabbi Ishmael said: Did the uncircumcised hear the voice of the Holy One, blessed be He, on Mount Sinai, saying, "I am the Lord thy God" (Ex. 20:2)? They were circumcised, but not according to its regulation. They had cut off the foreskin, but they had not uncovered the corona. Everyone who has been circumcised, but has not had the corona uncovered, is as though he had not been circumcised, therefore the text says, "Israel was not circumcised of old."
When they came to the land (of Canaan), the Holy One, blessed be He, said to Joshua: Joshua! Dost thou not know that the Israelites are not circumcised according to the proper regulation? He again circumcised them a second time, as it is said, "The Lord said unto Joshua, Make thee knives of flint, and circumcise again the children of Israel a second time" (Josh. 5:2). "And Joshua made him knives of flint" (Josh. 5:3), and he gathered all the foreskins until he made them (as high) as a hill, as it is said, "And he circumcised the children of Israel at the hill of the foreskins" (ibid.). The Israelites took the foreskin and the blood and covered them with the dust of the wilderness. When Balaam came, he saw all the wilderness filled with the foreskins of the Israelites, he said: Who will be able to arise by the merit of the blood of the covenant of this circumcision, which is covered by the dust? as it is said, "Who can count the dust of Jacob?" (Num. 23:10).