Bitcoin in exchanges can be seized, rules South Korea's Supreme Court

Source: PortaldoBitcoin Original Title: Bitcoins in exchanges can be seized, rules South Korea’s Supreme Court Original Link: South Korea’s Supreme Court has ruled that Bitcoins held in cryptocurrency exchanges can be seized in accordance with the country’s Criminal Procedure Code, ending a lawsuit filed by a suspect in a money laundering investigation.

The decision confirms that digital assets stored in exchanges qualify as targets for seizure during criminal investigations, even if they do not exist physically.

South Korea has one of the highest rates of cryptocurrency ownership in the world. As of March 2025, more than 16 million people — approximately one-third of the population — held cryptocurrency accounts in the country’s major exchanges.

The case originated from the police seizing 55.6 Bitcoins, valued at around 600 million Korean won (US$ 413,000) at the time, from an account at an exchange belonging to an individual identified only as Mr. A. The assets were seized as part of a money laundering investigation.

Mr. A later filed a reconsideration request, claiming that Bitcoins held in an exchange account could not be seized because they are not considered a “physical object” under Article 106 of the Criminal Procedure Code. This provision allows authorities to seize evidence or items subject to confiscation if they are recognized as related to a criminal case.

The Seoul Central District Court rejected the request, ruling that the seizure was legal. Mr. A then filed a new appeal with the Supreme Court in December.

In its final decision, the Supreme Court dismissed the argument that Bitcoins do not fall under the scope of the seizure law. “According to the Criminal Procedure Code, targets of seizure include both tangible objects and electronic information,” the court stated.

The court added that Bitcoins, “as an electronic token capable of being managed, traded, and substantially controlled independently in terms of economic value,” qualify as an asset that can be seized by courts or investigative agencies.

“The decision in this case, which seized Bitcoins on behalf of Mr. A, managed by a virtual asset exchange, is legal, and there is no error in the lower court’s decision to deny the reconsideration request,” the ruling said.

The decision aligns with a series of previous South Korean judicial rulings that treated cryptocurrencies as property or assets. In 2018, the Supreme Court ruled that Bitcoin is an intangible property with economic value and can be confiscated if obtained through criminal activity. In the same year, cryptographic tokens were recognized as divisible property in divorce proceedings.

In 2021, the court further clarified that Bitcoin constitutes a virtual asset embodying economic value and is considered a property right under criminal law.

Other jurisdictions have adopted similar approaches, classifying digital assets as property for legal and enforcement purposes. Recently, the United Kingdom enacted legislation that formally recognizes digital assets as property, granting them the same legal status as traditional forms of property. The law aims to provide clearer guidance for courts handling cases involving theft, inheritance, and insolvency related to crypto assets.

The legislation is based on recommendations from national legal bodies and provides legal backing to principles previously developed through common law.

Such measures aim to improve clarity and enforcement in cases involving digital assets, particularly regarding proceeds from criminal activities and asset recovery.