“The 500 million bitcoin confiscated four years ago to 12.5 billion won”⋯ The National Treasury also’Cryptocurrency Jackpot’

Input 2021.03.13 06:00

When the domestic price of bitcoin recently reached a record high, exceeding 65 million won, the value of cryptocurrency assets kept after the police confiscated and soared. While there is no ground law to dispose of the cryptocurrency confiscated by the police, the value of the cryptocurrency confiscated and the national treasury increased while it was unable to dispose of it.

On the 12th, the price of bitcoin recorded 66.4 million won on the domestic exchange Upbit, a record high. Compared to the price of 6.36 million won on March 12 last year, a year ago, it has increased more than 10 times.

In addition to Bitcoin, the price of other altcoins (collectively referred to as cryptocurrencies excluding Bitcoin) has also increased significantly. On the 12th, the price of Ethereum was about 2.09 million won, more than 14 times higher than last year’s same day (about 140,000 won).

Thanks to such a surge in cryptocurrency prices, the expected profits for the disposal of cryptocurrencies confiscated by the police through investigations of drug and sexual exploitation transactions taking place on the’Dark Web’ also surged. The police were unable to dispose of the cryptocurrencies they had confiscated so far and were storing them. It has not been sold in order to redeem the confiscated cryptocurrency to the national treasury because the underlying laws have not been properly established.

However, as the amendment bill of the Specific Financial Information Act, in which provisions on virtual assets were added, came into force in March this year, the disposal of confiscated cryptocurrencies became legally possible.

Although the police have not disclosed the exact size of the cryptocurrency confiscated so far, there are many observations that the amount of treasury redemption will be larger than expected, considering the recent increase in the dark web crime arrest rate. This is because many of the people who committed crimes using the dark web used cryptocurrency as a payment method instead of cash to avoid tracking.

According to the National Police Agency, about 750 of the narcotics offenders arrested last year used cryptocurrency, an increase of about 800% compared to 2019. It is known that the cryptocurrencies they received were also confiscated as they were presumed to be criminal proceeds if they were discovered during the investigation process.

Among the cryptocurrencies confiscated by the police, the case that is known to have caused the largest market price increase is the case of the seizure and search of illegal pornography site operators in 2017. At that time, the police arrested Mr. A on charges of receiving an illegal pornography site, recruiting 1.21 million members to upload pornography, and receiving a usage fee in bitcoin. The number of bitcoins confiscated by the police was 191, and the market price was only 500 million won at the time, but the current value was 12.5 billion won, a 25-fold increase in the amount.

The same is true of the case of’Park Sabang’, which earned the public’s resentment last year. Jo Joo-bin, the operator of the telegram doctor’s room for dissemination of sexual exploits, received Bitcoin, Ethereum, and Monero in exchange for an invitation to the doctor’s room that provides a number of female sexual exploits, including minors. At the time, the size of the cryptocurrency confiscated during the investigation by the police and prosecutors was not disclosed.

However, during the police investigation, it has been known to the outside that Ethereum worth 3.2 billion won was stored in the Ethereum wallet, which is estimated to be owned by Jo Joo-bin. In March-April last year, the Ethereum market price was about 140,000 to 170,000 won, and the current value of Ethereum 3.2 billion at the time was about 39 billion to 44.8 billion won. The sum of the cryptocurrency treasury exchange money in the two cases mentioned above is at least 50 billion won.

Cases in which the asset value of confiscated cryptocurrencies has skyrocketed are also appearing abroad. The Chinese government recently launched 191,475 Bitcoins (about 12,805 billion won) and 83,033 Ethereum (about 1,729.5 billion won) from the main culprit of the’Plus Token’, a cryptocurrency multi-level sale fraud. Each was confiscated. Converted into Korean money, it amounts to about 14,534.5 billion won.

In 2014, the police confiscated 29656 bitcoins found on drug trafficking sites in the United States, went through a short sale, and returned them to government treasury. It is known that the amount of treasury redemption at that time was about 18 million dollars (20.5 billion won).

Meanwhile, the police are focusing their efforts on the investigation of the dark web, a hotbed for cryptocurrency transactions. In particular, the number of investigation teams specializing in the dark web has doubled compared to the previous one to arrest drug criminal groups that frequently occur through the dark web.

An official from the National Police Agency explained, “We have expanded the’Dark Web’ professional investigation team, which was installed under the drug investigation units of the three local police agencies, including the Seoul Police Agency, the Gyeonggi South Office, and the Gyeongnam Police Agency, to six local police agencies from this year.” With the reinforcement of the police’s investigative power, the size of cryptocurrencies that will be returned to the national treasury is expected to increase further.