South Korea’s Gangnam Police Station has confirmed the loss of 22 Bitcoin that had been stored in a USB cold wallet since being seized in a 2021 investigation. The assets, valued at roughly $1.5 million, were reportedly transferred out of the wallet without the physical device being stolen.
The incident came to light during a broader nationwide inspection of investigative agencies’ digital asset custody procedures. Officials said the Bitcoin had remained untouched for years due to a suspended case, allowing the unauthorized transfer to go undetected until the recent audit. The Gyeonggi Bukbu Provincial Police Agency has launched an internal probe to determine the cause of the breach and assess possible internal involvement.
The loss follows a separate case involving hundreds of seized Bitcoin reportedly drained from another investigative body after a phishing-related error, underscoring systemic operational risks. The developments highlight growing institutional challenges around secure storage, chain-of-custody protocols, and governance standards for confiscated digital assets held by law enforcement.
