South Korean Tax Agency Accidentally Exposes Seed Phrase, Leading to $4.8 Million Token Theft

South Korea’s National Tax Service (NTS) pursued 124 high-value, habitual tax delinquents and seized a combined 8.1 billion won in cash, crypto assets, luxury goods and other property. A seed phrase provides ultimate control over a wallet’s assets, allowing anyone who obtains it to reconstruct the private keys. The incident exposed weaknesses in government procedures for seizing, safeguarding and publicly documenting digital-asset evidence.

On February 26, 2026, a photo in an NTS press release showed an unredacted seed phrase beside a Ledger cold wallet. About 4 million PRTG tokens were transferred to an unknown address between 7:43 p.m. and 8:13 p.m. that evening. They were worth about $4.8 million, or roughly 6.9 billion won, at the time. The NTS later apologized and opened an investigation. Reports on March 20 said it was considering appointing a private custodian and aimed to select a service provider in the first half of 2026.