- Prosecutors discovered missing Bitcoin during a routine inspection of seized digital assets.
- The loss is linked to a suspected phishing incident involving stored private keys.
- Internal estimates value the missing Bitcoin at around 70 billion won.
South Korean prosecutors are investigating the loss of a large amount of Bitcoin that had been seized and held as evidence in a criminal case, raising fresh concerns over how digital assets are stored and protected by public authorities.
According to reports, this incident occurred at the Gwangju District Prosecutors’ Office, which recently discovered that a significant quantity of confiscated Bitcoin had gone missing during a routine inspection.
While prosecutors have not disclosed the exact amount, officials familiar with the matter said the value could reach tens of billions of won, with internal estimates putting the figure at around 70 billion won, or roughly $48 million.
Loss Discovered During Routine Security Check
According to prosecutors, the disappearance was detected while staff were conducting regular checks on seized financial assets. The office stores access information for confiscated cryptocurrencies, including private keys and passwords, on removable storage devices such as USB drives.
Investigators believe the loss occurred when a staff member unintentionally accessed a fraudulent or “phishing” website while the storage device was connected. That action may have exposed the private keys to malicious software or hackers, effectively cutting off access to Bitcoin.
Internal Investigation Underway
The Gwangju prosecutors’ office has launched an internal probe to determine how the breach happened and whether any of the missing assets can be recovered. Officials said they are also reviewing their handling of other seized digital assets to ensure no additional losses have occurred.
“We understand that the incident occurred when a so-called ‘fake (scam) site’ was accidentally accessed during a regular inspection of the confiscated Bitcoin. Within the prosecution, there is talk that the amount of lost Bitcoin is worth 70 billion won,” an official said.
A prosecution official said the incident likely occurred around the middle of last year, but declined to provide further details, citing the ongoing investigation.
Growing Crypto Seizures, Growing Risks
South Korea has intensified its crackdown on crypto-related crimes in recent years, including fraud and money laundering. As a result, the amount of cryptocurrency seized by authorities has risen sharply.
South Korea’s Supreme Court ruled that Bitcoin held on centralized exchanges qualifies as “electronic property” with economic value, making it subject to seizure under criminal law. Authorities have also recently dismantled several large crypto-based money laundering networks, some involving sums exceeding 100 billion won.
Related: Thailand SEC Prepares Framework for Crypto ETFs, Futures, and Tokenised Investments
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