The South Korean prosecutor's office in Gwangju has launched an investigation into the disappearance of bitcoins worth 70 billion won ($47.7 million). Local media report this news.

19 February 2026 | 15:55 Update:

A hacker has voluntarily returned 320.8 BTC to a wallet controlled by authorities, according to a local publication. The perpetrator was unable to withdraw the funds as the prosecutor's office managed to block his transactions on an unnamed centralized exchange.

The identity of the hacker remains unknown, but the investigation is ongoing.

The government agency discovered the missing bitcoins during a routine audit of confiscated assets.

During the internal audit, it was revealed that the loss was due to a password leak. One of the agency's employees fell victim to a phishing attack by visiting a fake website.

“We are currently investigating the circumstances of the loss and the whereabouts of the confiscated assets. We cannot confirm any specific details,” representatives of the prosecutor's office commented in a conversation with Yonhap News.

In early January, the Supreme Court of South Korea recognized the legality of seizing bitcoins from exchange wallets in criminal cases for the first time. Previously, only the confiscation of assets for the benefit of the state was permitted.

Uncovering a Criminal Crypto Network

On January 19, South Korea dismantled a money transfer network through which criminals moved digital assets worth 150 billion won (~$110 million).

The local customs service has handed over the case to the prosecutor's office against three suspects, including a 30-year-old Chinese national. They are accused of violating the Foreign Exchange Transactions Act.

The investigation found that over four years of operation, the illegal organization laundered more than $100 million obtained through payment services WeChat Pay and Alipay. The scheme worked as follows: the criminals converted funds into cryptocurrency on foreign exchanges, transferred them to wallets in South Korea, and then cashed out.

To disguise the transfers, they used legitimate descriptions: payments for plastic surgeries and tuition for studying abroad.

Recall that in November, the largest South Korean exchange, Upbit, was hacked for $36.8 million due to a vulnerability in its internal system.