South Korea to Overhaul Crypto Custody After $30M Seizure Leak
South Korean financial authorities are revising digital asset custody protocols following a series of security breaches that resulted in the loss of nearly $30 million in seized cryptocurrencies. The leaks, which occurred during recovery operations, have prompted a government-wide review of crypto holdings across public institutions.
Deputy Prime Minister Koo Yun-cheol confirmed the overhaul, emphasizing tighter controls for assets seized from tax evaders and other enforcement actions. The National Tax Service will collaborate with the Financial Services Commission and Financial Supervisory Service to implement new safeguards.
The incident highlights growing pains in institutional crypto management. Unlike private sector custodians, Korean authorities currently only handle cryptocurrencies obtained through legal seizures—a limitation that may change as digital assets become more prevalent in financial systems.
