The South Korean National Police Agency has officially ordered all investigative departments to transfer seized crypto assets to Upbit Custody, the custodial unit of Dunamu, operator of crypto exchange Upbit. A report from local daily Segye Ilbo on November 9, 2026, stated that this transition includes the distribution of operational manuals and technical training for police investigators.
The decision to outsource evidence management to the private sector stems from a critical issue: several seized Bitcoins previously went missing while under the direct custody of law enforcement officers.
Why Self-Management Was Discontinued
Previously, storing crypto evidence relied on the initiative of individual investigators across local police stations. Officers were independently responsible for purchasing hardware wallets and managing mnemonic seed phrases. This manual process created loopholes for negligence and abuse of authority, ultimately resulting in the loss of seized assets.
The government addressed the missing assets through official procurement channels. Dunamu won a one-year public contract from South Korea’s Public Procurement Service on August 7 after scoring 94.14 points in a technical evaluation.
Distributed Key Architecture and Full Guarantees
Under the new framework, all crypto assets seized in criminal cases will be transferred to Upbit Custody and stored in cold wallets completely disconnected from the internet at Dunamu’s high-security facility. Asset security will no longer rely on a single officer. Upbit employs Multi-Party Computation (MPC) and Distributed Key Generation technology, distributing cryptographic key control across multiple parties.
The custodial infrastructure is supported by multi-signature (multisig) technology with segregated accounts organized by asset type and specific legal cases. Upbit also provides a 24-hour technical support team to assist with cross-blockchain transfers, while covering all transaction fees associated with police asset transfers. Once a case is referred to prosecutors, the seized crypto is immediately forwarded to the prosecution’s official account.
Dunamu included financial protection clauses in the contract, offering a 100% compensation guarantee if any crypto assets are lost while under its custody.
Special Exemption for Privacy Coins
Despite the nationwide overhaul, the agreement includes one strict exception: privacy-focused assets such as Monero (XMR) are excluded from the contract and will continue to be held on police-owned hardware wallets.
For police investigators, transferring custody to Upbit ends the practice of individually purchasing hardware wallets and managing seed phrases at their desks. Storage responsibility now shifts to a licensed third party with segregated accounts per case - while investigators directly retain only privacy coins excluded from the centralized custody system.
Reported by crypto.news.
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Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
