The ruling reiterates that the seizure of bitcoin held on exchange platforms is consistent with criminal law.
According to the Chosun Daily, South Korea’s Supreme Court has issued a ruling that unequivocally establishes the authorities’ power to seize bitcoin and other cryptocurrencies held on centralized exchanges.
The legal dispute stemmed from a money-laundering investigation, during which law enforcement seized 55.6 BTC from an exchange account registered to an individual identified as “Mr. A.” At the time of the confiscation, the total value of the digital assets amounted to approximately 600 million South Korean won, or about $410,000.
The account holder challenged the legality of the action by filing a motion for reconsideration with the Seoul Central District Court. The defense argument was based on an interpretation of Article 106 of South Korea’s Criminal Procedure Act, claiming that the seizure of bitcoin was unlawful because the asset does not constitute a tangible “physical object” and therefore falls outside the scope of evidentiary seizure provisions.
After the motion was dismissed by the court of first instance, the claimant appealed to the Supreme Court last December. The country’s highest court upheld the lower courts’ decisions, definitively rejecting the appeal.
The Supreme Court clarified that “under the Criminal Procedure Act, the objects of seizure include both tangible items and electronic information.” The judges further explained that bitcoin, “as an electronic token capable of being managed, transferred, and independently controlled in terms of economic value,” clearly falls within the category of assets that can be seized by courts and investigative agencies.
This ruling fits within a broader line of case law that has progressively recognized digital assets as fully fledged property under the law. As early as 2018, South Korea’s Supreme Court had ruled that bitcoin constitutes intangible property with economic value and may be confiscated if acquired through criminal activity.
In the same year, digital assets were recognized as divisible assets in divorce proceedings. In 2021, a further ruling clarified that bitcoin represents a virtual asset that embodies economic value and constitutes a proprietary interest under criminal law.
Global context
South Korea’s approach to bitcoin seizure reflects a global trend toward the legal recognition of digital assets. Last month, the United Kingdom passed legislation formally recognizing digital assets as property, granting them the same legal status as traditional forms of ownership.
The UK legislation, developed on the basis of recommendations from the Law Commission of England and Wales, provides a statutory foundation for legal principles previously developed through common law. Its aim is to improve clarity and enforceability in disputes involving theft, succession, and insolvency related to crypto assets.
