On February 28, 2026, a striking case involving cryptocurrency theft and alleged police corruption came to a head in South Korea. The Uijeongbu District Court issued an arrest warrant for a man in his 40s, identified only as A, who was the real operator of a coin company. The charges? Violating the Information and Communications Network Act and committing computer fraud under the Act on the Aggravated Punishment of Specific Economic Crimes. But this is no ordinary tale of digital misdeeds—it’s a story that pulls back the curtain on the vulnerabilities of law enforcement, the temptations of cryptocurrency, and the high-stakes world of digital assets.
According to JoongAng Ilbo and Yonhap News, A is suspected of stealing 22 bitcoins that had been stored by the Gangnam Police Station in Seoul since May 2022. The story begins earlier, in 2020, when A and his associates reported to police that their own issued coins had been hacked. In response, they voluntarily submitted 22 bitcoins to the authorities, who accepted the digital assets and kept them in a cold wallet—a USB-style offline electronic wallet, touted as a secure way to store cryptocurrency.
But the plot thickened. Investigators later found that A and his associates had knowledge of the mnemonic code—a unique recovery phrase needed to access and move the bitcoins from the cold wallet. Using this knowledge, A managed to quietly steal the 22 bitcoins that were supposed to be under police protection. The bitcoins, once stolen, didn’t just sit idle. Instead, they were converted into about 1 billion won (roughly $750,000 USD at the time), and the cash was used by A to alleviate the company’s financial difficulties. As Yonhap News noted, "A used the mnemonic code to steal bitcoins kept in an offline wallet called a cold wallet in the form of a USB."
But how did A get so close to the evidence? Here’s where the story takes a darker turn. According to court documents and reporting by JoongAng Ilbo, A offered 6 million won in cash—along with meal expenses—to the police officer in charge, in a bid to have the seized coins returned. The bribe, while not unheard of in corruption cases, underscores the persistent risks that come with policing new frontiers like digital currency. The court, weighing the evidence, stated that there was a real risk of A fleeing or destroying evidence, which led to the issuance of the arrest warrant.
However, not everyone implicated in the case faced the same fate. The arrest warrant for the coin company’s official representative, B, was dismissed. The court found no substantial risk that B would flee or tamper with evidence, and so B was spared the same legal jeopardy as A. This distinction hints at the complexities of corporate responsibility and individual accountability in the fast-moving world of cryptocurrency.
The saga is emblematic of the challenges law enforcement faces in the digital age. When A and his colleagues first approached police in 2020, claiming their own coin had been hacked, the authorities likely believed they were helping victims of a sophisticated cybercrime. The police took the 22 bitcoins as a voluntary submission, treating them as evidence or possibly as assets to be protected while the case was investigated. But the cold wallet—a device designed to be unhackable when disconnected from the internet—proved only as secure as the secrecy of its mnemonic code. As it turned out, A and his team’s prior knowledge of the recovery phrase rendered the police’s precautions moot.
The theft was not discovered immediately. It was only after the digital assets had been moved and converted into cash that investigators pieced together what had happened. The use of the mnemonic code to access the cold wallet was a crucial detail: it’s a reminder that, in the world of cryptocurrency, control over assets often boils down to who knows the password—or, in this case, the recovery phrase. The police, unfamiliar with the intricacies of digital wallets and the risks of insider knowledge, were outmaneuvered.
It’s a cautionary tale for law enforcement agencies everywhere. As more crimes involve digital assets, police and prosecutors are being forced to rapidly learn the ins and outs of blockchain technology, wallet security, and the unique risks posed by cryptocurrencies. The Gangnam Police Station’s experience shows that even well-intentioned efforts to safeguard evidence can be undermined by gaps in technical expertise or lapses in internal controls.
From a legal perspective, the charges leveled against A are severe. Violations of the Information and Communications Network Act, combined with computer fraud under the Act on the Aggravated Punishment of Specific Economic Crimes, carry heavy penalties in South Korea. The court’s explicit mention of the risk of flight and evidence destruction suggests that prosecutors are taking no chances with a suspect who has already demonstrated cunning and resourcefulness.
The financial dimension of the case is also noteworthy. The conversion of 22 bitcoins into roughly 1 billion won provided a lifeline for A’s struggling coin company. According to JoongAng Ilbo, "A used the mnemonic code to steal bitcoins kept in an offline wallet called a cold wallet in the form of a USB." The proceeds were used to resolve company financial difficulties, blurring the line between corporate survival and criminal conduct. It’s a stark illustration of how the volatility and liquidity of cryptocurrencies can make them both a target and a tool for those in desperate straits.
At the same time, the case raises important questions about the safeguards in place for handling digital evidence. Should police have required the mnemonic code to be surrendered along with the cold wallet? Was there sufficient oversight of the assets once they were in police custody? And how can law enforcement agencies prevent similar breaches in the future?
For now, the focus is on the legal proceedings against A. The court’s decision to issue an arrest warrant reflects the seriousness with which South Korean authorities are treating the theft. But the implications go far beyond one man and one company. As digital assets become more deeply woven into the fabric of the global economy, the need for robust security, transparency, and accountability will only grow.
The Gangnam bitcoin theft serves as a sobering reminder: in the world of cryptocurrency, trust is often as fragile as a forgotten password. For law enforcement, regulators, and the public alike, the case is a wake-up call—one that’s likely to echo far beyond Seoul’s police evidence room.