Seizing Bitcoins declared ‘inappropriate’ in South Korea
In an unprecedented move, a South Korean court has ruled it is inappropriate to confiscate Bitcoins in the country.
In 2016, police officers in the South Gyeonggi province seized 216 Bitcoins from a man who was charged with operating an obscene website. The government has announced that it will auction the cache of digital currency, with the money raised to be forwarded to the South Korean Treasury as an additional asset for the government.
The South Korean government was expected to make a killing from the auction, until the Suwon district court threw a wrench in its plan.
On Friday, the court declared that “Bitcoin is not subject to confiscation,” the Kyunghyang Shinmun reported.
“It is not appropriate to confiscate Bitcoins because they are in the form of electronic files without physical entities, unlike cash… Virtual currency cannot assume an objective standard value,” the court stated, according to the report.
The court also noted that “it is difficult to calculate the value of the virtual currency even if it should be added,” explaining that “even if virtual money is recognized as a criminal profit, it means that it should be calculated by calculating the corresponding amount instead of confiscation.”
The court’s ruling could set a precedent in relation to authorities confiscating cryptocurrencies in the country, whose government has yet to regulate Bitcoin. Despite being one of the world’s busiest markets for digital currency trading, South Korea currently doesn’t have a regulatory framework that would give cryptocurrencies like Bitcoin and Bitcoin Cash legal grounds in the country.
In July, Rep. Park Yong-jin, member of the ruling Democratic Party of Korea, drew up a set of bills to sought to build a regulatory framework for digital currencies. In his proposal, Park—who compared cryptocurrencies with Europe’s tulip craze in the 17th century—said there is a need to address “the void of a state-led protection that guarantees digital currency’s value,” citing “digital currency’s nonexchangeability to other existing currencies” as well as “the possibility of wreaking havoc on national economy from digital currency bubble burst.”
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