South Korea Sells $21.5 Million in Recovered Bitcoin After Custody Breach

Authorities in South Korea have sold 320.8 units of Bitcoin that were recovered after a phishing incident temporarily removed the digital assets from government custody. The Gwangju District Prosecutors’ Office confirmed the sale generated approximately 31.59 billion Korean won, or about $21.5 million, which has been transferred to the national treasury.

To limit potential market disruption, officials sold the bitcoin gradually in small batches over an 11-day period between Feb. 24 and March 6. The crypto had originally been seized from a suspect accused of operating an illegal gambling platform that allegedly processed around 390 billion won in wagers between 2018 and 2021.

Bitcoin Returned After Phishing Incident

The assets were briefly lost in August 2025 during a custody transfer when asset managers were deceived by a phishing website. Investigators later traced the funds to a hacker controlled wallet.

After authorities coordinated with domestic and international exchanges to freeze the address, the hacker returned 320.88 BTC to a government wallet on Feb. 17.

Separately, several South Korean courts are reviewing new guidelines that may treat cryptocurrency investment losses similarly to other asset losses during personal debt rehabilitation cases.

Disclaimer

This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.