For the first time, South Korea’s Supreme Court has deemed it lawful to seize bitcoins from exchange wallets in criminal cases, according to local media.
Previously, only the confiscation of assets for the state was permitted.
The precedent was set in the case of a user known as “A,” suspected of money laundering. In January 2020, police seized 55.6 BTC (then approximately 600 million won) from his exchange account.
The defense filed an appeal, arguing that cryptocurrency on platform accounts is not a physical object. According to the lawyers, it is not subject to the Criminal Procedure Code’s provisions on the seizure of physical evidence.
The court rejected this argument and deemed the investigators’ actions lawful. The ruling stated that objects of seizure include not only tangible items but also electronic information.
The judges identified bitcoin as an electronic token with economic value. The owner can manage and transfer it, making the asset a legitimate target for law enforcement seizure.
Lawyers believe the verdict removes legal ambiguity.
Investigators now have a clear basis for freezing funds on exchanges like Upbit and Bithumb during the investigation phase.
In 2018, South Korea’s Supreme Court recognized digital gold as an asset subject to confiscation, and in 2021, extended fraud laws to cryptocurrencies.