South Korea’s Tax Authority Expands Crypto Seizure Powers to Cold Wallets

South Korea's National Tax Service has escalated its enforcement measures, now targeting offline cryptocurrency storage devices like cold wallets for seizure when taxpayers fail to settle outstanding liabilities. The agency confirmed officers may conduct home visits to confiscate such assets, marking a significant expansion of its digital asset recovery capabilities.

Between 2021 and 2024, tax authorities collected approximately 146 billion won ($106 million) from 14,140 individuals through forced crypto seizures. Regional governments have mirrored this aggressive approach—Cheongju city recovered 1.5 billion won from 203 residents, while Seoul's Gangnam District clawed back 140 million won from a single high-value delinquent earlier this year.

The crackdown leverages advanced blockchain forensics, with municipalities deploying systems that cross-reference exchange records with on-chain wallet activity. This technological infrastructure enables real-time tracking of asset transfers and identification of tax-evading holders, regardless of their storage methods.