South Korea weighs new legal framework for seizing self custodied crypto
South Korean tax officials have proposed amendments to the countrys Criminal Procedure Act to establish a legal framework for seizing self-custodied digital assets, arguing that existing rules do not adequately cover wallets controlled through private keys. SummarySouth Korean tax officials have proposed changes to criminal law to allow the seizure of self custodied digital assets.The proposal sets out warrant requirements and recommends court supervised joint wallets to store seized crypto assets.The recommendations follow recent efforts by the National Tax Service to strengthen crypto custody after a security breach exposed seized assets. According to Digital Asset, four officials from South Korea‘s National Tax Service, including investigation team leader Jang Hee-won, published a paper in the June edition of the Korea Institute of Criminology and Justice’s Criminal Policy Research journal outlining legislative changes for handling self-custodied virtual assets during criminal investigations. The proposal focuses on digital assets held directly by individuals through private keys rather than those stored with exchanges or other third-party custodians. Personal wallets, including hardware wallets, fall into this category. Existing law leaves gaps for self-custodied assets The paper points to a 2025 South Korean Supreme Court ruling that found investigators acted lawfully when seizing Bitcoin held in an exchange wallet. While the authors