South Korea’s Supreme Court has issued a landmark ruling stating that bitcoin held in custodial accounts at crypto exchanges can be seized during criminal investigations. The decision draws a clearer legal boundary around digital assets in the country, confirming that virtual assets are not outside the reach of criminal procedure simply because they exist in electronic form.
Bitcoin recognized as seizable property
In its reasoning, the court relied on the Act on Protection of Virtual Asset Users as well as prior case law. It said virtual assets are electronic tokens with economic value that can be traded or transferred electronically, which means bitcoin falls within the scope of assets that courts and investigative authorities may seize. The court also reaffirmed its earlier view that bitcoin can be subject to confiscation by the state.
The appellant had argued that bitcoin held in an exchange account should not qualify as an “object” subject to seizure under the Criminal Procedure Act, and that the seizure should therefore be canceled. Lower courts rejected that argument, finding that although virtual assets are not traditional tangible objects, they still qualify as assets that may be confiscated because they are electronically transferable tokens with independent economic value. The Supreme Court endorsed that analysis.
Case tied to a 2020 money laundering probe
The dispute stemmed from a January 2020 money laundering investigation. Police seized 55.6 BTC held in a custodial exchange account under the name of Mr. A. At the time, the assets were valued at around 600 million won, or roughly $416,600. After multiple legal challenges, the Supreme Court concluded that the seizure was lawful and that the lower court made no error in dismissing the quasi-appeal.
The ruling is significant because the court made clear that seizure targets under criminal procedure are not limited to physical property. They may also include electronically managed assets that carry independent economic value and can be practically controlled. That interpretation gives investigators firmer legal footing when dealing with crypto assets held through centralized platforms.
Builds on earlier Supreme Court precedents
Legal observers see the judgment as a consolidation of earlier Supreme Court decisions from 2018 and 2021, which had already characterized bitcoin as intangible property with monetary value and as a virtual asset capable of constituting criminal proceeds. By confirming that exchange-held bitcoin may be seized at the investigation stage, the new ruling adds enforcement clarity and further integrates digital assets into South Korea’s established criminal law framework.
For the broader crypto industry, the ruling may carry implications for exchange custody practices, compliance cooperation, and the treatment of digital assets linked to criminal investigations. More broadly, it signals that South Korean courts are continuing to fit virtual assets into existing legal doctrines rather than treating them as a category beyond traditional enforcement tools.