South Korean Authorities Lose Hundreds of Seized Bitcoin Due to Security Failures
Multiple cases of missing Bitcoin from government custody trigger debate in South Korea over inadequate security standards at law enforcement agencies.
South Korean law enforcement agencies have lost seized Bitcoin in multiple cases, sparking a nationwide discussion about insufficient security measures.
The Gwangju Prosecutor's Office seized 1,798 Bitcoin in 2022 as part of an investigation into an illegal gambling platform. However, only 320 BTC could actually be secured – the remaining 1,476 BTC remained unaccounted for. In December 2025, it was discovered that even the 320 Bitcoin in custody had disappeared, presumably through a phishing attack targeting the responsible investigators [1].
A nationwide audit ordered in response uncovered another case: The Gangnam Police Station in Seoul confirmed the loss of 22 Bitcoin that had been in custody since November 2021. In both cases, the physical hardware wallets remained intact [1].
The incidents raise questions about custody practices for digital assets. Experts criticize the lack of multi-signature procedures, inadequate access controls, and the absence of uniform national standards. Ongoing investigations are to determine whether structural weaknesses, individual misconduct, or internal involvement are present [1].
The cases are likely to attract international attention, as many countries face similar challenges in the secure custody of confiscated cryptocurrencies.
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