South Korea police prepared new rules for seized crypto assets. Guidelines cover dark coins, wallets, and secure storage after rising digital crime cases.
South Korea police prepared new rules to manage seized crypto assets more safely. The National Police Agency developed guidelines on the handling of digital evidence. Officials want clear steps for storing & transferring confiscated cryptocurrencies. The move comes after several cases where virtual assets had been lost in investigations.
Police Create New System to Manage Confiscated Crypto Assets
According to Asiae, the National Police Agency completed the draft of new instructions on March 17, 2026. The document describes how officers must deal with crypto at every stage. These steps include the seizure, storage and transfer to prosecutors after investigations.
The guidelines also include privacy-focused coins for the first time. These assets are sometimes referred to as dark coins because they conceal transaction information. Unlike normal cryptocurrencies, the currency of these coins becomes very difficult to track. Because of this, they are sometimes used for crimes and money laundering.
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Police said dark coins must be stored safely using special tools. Normal crypto can be stored in hardware wallets such as USB devices. However, privacy coins usually require the installation of software wallets on computers or servers. Therefore, the new rules provide the way officers are to manage these wallets.
The agency also developed a hot wallet management plan. A hot wallet is software that is used in order to store digital assets online. There are some strict steps to be followed by officers in the use of these wallets. The aim is to prevent the hacking, loss or misuse of confiscated funds.
Authorities said the new system became necessary following several incidents. In the past, government agencies lost access to seized crypto. Due to this, the police decided to reconstruct the management process. The new rules have a goal of protecting digital evidence during investigations.
Privacy Coins and Security Risks Push New Rules
Privacy coins are intended to conceal information about the sender, receiver and amount of a transaction. Because of this feature, criminals sometimes use them to go undetected. Police said that such coins showed up in serious cases of crimes in recent years.
One well-known case was of illegal videos online spread through the social network of application Telegram. Privacy coins aided in moving the money without easy tracking, said investigators. Officials also think some hackers use these coins to launder stolen money.
The guidelines also include strict security measures for all the seized assets. Officers are required to check balances with public keys only. Private keys/recovery phrases should not be kept online at any point. This rule is used to prevent theft and phishing attacks.
The police are also planning to choose a private custody company in 2026. This company will help store seized crypto in a safe way. Earlier attempts to select a provider yielded failures due to failure of applicants to meet the requirements. Officials are hoping the next selection will be a success.
South Korea police reported that large amounts of crypto were seized in the last years. In the past five years, the investigators seized approximately 54.5 billion won in virtual assets. This is comprised of 50.7 billion won of Bitcoin and 1.8 billion won of Ethereum.
The agency also reserved 83 million won for managing these assets under the new system. Officials said the rules follow a decision made by the Supreme Court in December 2025. The court validated that the Bitcoin can be treated as a property that the police can seize.
With the crack of increasing digital crime, South Korea wants to have more control of virtual assets. The new rules are an attempt to preserve evidence and to avoid losses.
