Korean prosecutors make a mistake! Gwangju District Prosecutors Office loses 70 billion KRW worth of Bitcoin, suspected of being phished

Gwangju District Prosecutors’ Office in South Korea reportedly lost approximately 70 billion Korean won worth of Bitcoin due to an accidental click on a phishing website. The incident has exposed significant vulnerabilities in the public sector’s custody and cybersecurity processes for digital assets.

According to Yonhap News Agency, during an internal asset inventory check, the Gwangju District Prosecutors’ Office recently discovered that a large amount of Bitcoin, seized in a criminal case and under their custody, had mysteriously disappeared. An official investigation has now been officially launched.

The report mentions that the loss of these Bitcoins likely occurred around mid-2025. Investigators suspect that during routine checks of seized assets, the prosecutors may have inadvertently clicked on a phishing scam website, leading to the loss of the assets.

As the case is still under investigation, authorities have not disclosed the exact amount of Bitcoin lost nor provided further details. However, an official revealed that there are rumors within the office that the missing Bitcoin is valued at 70 billion Korean won (approximately 48 million USD).

It is noteworthy that the Gwangju District Prosecutors’ Office has previous experience handling large-scale cryptocurrency seizure cases. As early as March 2024, the office attempted to recover Bitcoin worth about 170 billion Korean won (around 127 million USD) related to an illegal online gambling case. The recent reports of lost assets have raised high public concern over the prosecutor’s ability to securely manage cryptocurrencies.

The first concern from the public is whether the seizure procedures adhered to standard operating protocols. If only hardware devices containing wallet information were seized, without actually transferring the Bitcoin to a custody wallet controlled by the prosecutors, then the original holders could still access the assets if they possess backup private keys.

Secondly, the environment in which the wallets are created is crucial. If the prosecutors set up new custody wallets on “internet-connected computers,” the private keys could be exposed at the moment of generation. According to cybersecurity best practices, cryptocurrency wallets should be created on completely offline, isolated devices to prevent any external intrusion.

Thirdly, how private keys are stored is equally important. Storing private keys on internet-connected devices or in cloud storage essentially opens the door for hackers. A more secure approach is to write the private keys on paper and store them offline in a safe place.

Finally, human factors pose significant risks. Even a brief leak can allow private keys to be copied within seconds. The report mentions that personnel involved may have accidentally visited a phishing website during routine checks, reflecting potential gaps in cybersecurity awareness, operational procedures, and access management within the prosecutors’ office.

• This article is reprinted with permission from: 《BlockCast》
• Original title: 《South Korean Prosecutors’ Blunder! Gwangju District Prosecutors’ Office “Loses” Seized Bitcoin and Suspected Phishing Attack》
• Original author: Block Sister MEL