A hacker returned 320 BTC stolen from prosecutors, enabling a $21.5M sale while separate cases exposed crypto security gaps across agencies.
South Korean prosecutors have converted seized Bitcoin into cash after an unusual cybersecurity incident. The funds were originally taken during a criminal investigation linked to an international gambling platform. Months later, the same Bitcoin disappeared after officials fell victim to a phishing attack. In an unexpected twist, the hacker later returned the assets, allowing authorities to sell them.
Hacker Returns 320 Bitcoin to South Korean Authorities After Phishing Theft
South Korea’s Gwangju District Prosecutors’ Office sold 320.8 BTC and transferred 31.6 billion Korean won, about $21.5 million, to the national treasury. Local media outlets reported the development on Tuesday.
Authorities first obtained the Bitcoin during a raid on an international gambling operation that ran from 2018 to 2021. Operators allegedly converted illicit profits into Bitcoin to conceal the origin of the funds.
However, the situation changed in August 2025. Officials responsible for managing the seized cryptocurrency accessed a phishing website, allowing attackers to steal the entire holding. The breach remained unnoticed until December.
But in an unexpected development last month, the hacker returned the full 320.8 BTC to the prosecutors’ wallet. Authorities said they had already restricted the wallet from several liquidation channels before the funds reappeared.
Series of Crypto Handling Errors Across South Korean Agencies Triggers Investigation
Following the recovery, prosecutors moved quickly to sell the assets. According to Chosun Ilbo, the office sold the Bitcoin in batches across 11 days, between Feb. 24 and March 6. Investigators are still searching for the person responsible for the earlier theft.
Meanwhile, the case has drawn attention to wider security issues across South Korean government agencies.
A nationwide internal review later uncovered another incident at Seoul’s Gangnam Police Station. Officers reported that 22 BTC stored in a USB cold wallet had been missing since 2021. Since the device itself was never stolen, investigators are examining the possibility of internal involvement.
At the same time, the National Tax Service faced criticism after exposing a crypto wallet recovery phrase in a public report. Soon after the disclosure, 4 million Pre-Retogeum (PRTG) tokens moved from the wallet to an unidentified address.
