The National Tax Service admitted accidental exposure of hardware wallet recovery phrases, prompting police investigation and internal asset management review.
South Korea’s National Tax Service lost approximately $4.8 million in cryptocurrencies after publicly released photographs disclosed recovery phrases from seized hardware wallets. The leaked mnemonics enabled unauthorized access to the funds. The agency apologized for the failure, requested police assistance to trace the stolen assets, and initiated a comprehensive audit of its digital asset handling procedures. This incident highlights growing concerns over secure management of confiscated crypto holdings by government institutions.