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South Korean financial authorities have pledged to revise their crypto custody practices following public scrutiny over multiple incidents that led to the loss of nearly $30 million in seized digital assets over the past few months.

Authorities Move To Enhance Crypto Custody Practices

South Korea’s Deputy Prime Minister and Minister of Finance, Koo Yun-cheol, affirmed that authorities will review their management practices of seized crypto assets by government and public authorities, and develop measures to prevent the theft and loss of these assets.

“In response to the recent digital asset information leak incident at the National Tax Service (NTS), the government will promptly review the status and management practices of digital assets held and managed by government and public institutions—such as those seized from delinquent taxpayers—in collaboration with relevant agencies, including the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS),” the finance minister wrote in a Sunday X post.

“We will also swiftly develop and implement measures to prevent recurrence, including strengthening digital asset security management,” he continued, noting that the South Korean government only holds crypto assets acquired through legal enforcement actions, such as seizure.

The upcoming review and Koo’s statement follow a wave of criticism over the authorities’ practices and management of crypto assets after the tax agency exposed the recovery seed phrase of a seized wallet, leading to unauthorized access and theft of the tokens inside it.

As reported by Bitcoinist, South Korea’s National Tax Service recently published an official press release to highlight its crackdown on tax nonpayers, but accidentally shared a full wallet seed phrase in the process.

The Thursday press release was reportedly part of a broader NTS enforcement campaign targeted at people who owed taxes, showing seized crypto assets as evidence of the agency’s efforts.

Nonetheless, it included an image of two Ledger cold wallets alongside a handwritten sheet of paper that exposed the wallets’ complete mnemonic recovery phrases.

Soon after, one of the confiscated wallets’ entire balance, 4 million Pre-Retogeum (PRTG) tokens worth around $4.8 million, was transferred to another address, blockchain researchers found, but noted that the cryptocurrency has extremely low liquidity.

According to Professor Cho Jae-woo of Hansung University’s Blockchain Research Institute, the other wallets with seed phrases visible in the same image did not appear to carry significant risk, as the leaked tokens are also difficult to convert into cash.

The expert criticized the incident, but shared his hope that it “serves as a turning point for the establishment of a robust virtual asset management system within Korea’s public sector.”

South Korea’s Custody Mishaps

Last week’s incident is the latest in a series of security breaches that have led to the loss of around $27 million in seized crypto assets under the government’s custody since the start of the year.

In January, the Gwangju District Prosecutors’ Office faced backlash after discovering that 320 Bitcoin (BTC), worth around $21 million, had gone missing months ago. According to local reports, authorities only discovered the theft during a routine check of seized financial assets held as criminal evidence.

Prosecutors found that the crypto assets, first seized in 2021, were lost to a scam in August while authorities were handling the assets. Notably, a malicious actor drained the wallets after investigators mistakenly accessed a phishing website.

In an unexpected turn of events, the hacker returned the stolen Bitcoin in mid-February, the Gwangju District Prosecutors’ Office confirmed, vowing to continue to track down the malicious actors involved while conducting related investigations and inspections.

The incident led to a nationwide review, which revealed another security breach at the Seoul Gangnam Police Station last month. The Gangnam station announced it had lost 22 BTC, worth around $1.4 million at the time, that were voluntarily submitted to authorities during an investigation in November 2021.

Local news outlets reported that the leak had not been detected until recently, as the investigation into that case had been suspended. The inspection revealed that the cold wallet storing the Bitcoin was not stolen. However, the assets stored inside had vanished without a trace, deepening concerns about local authorities’ knowledge of cryptocurrencies and proper measures to handle and custody seized digital assets.

A well-known Solana NFT marketplace that once pushed hard into Bitcoin and other chains has quietly started to shrink its footprint.

Reports say the shift will be fast and clear: several services will stop working in March and April as the company focuses where it thinks the money is.

Magic Eden Pulls Back To Solana

The change is not small. Support for EVM and Bitcoin Ordinals and Runes is being wound down on March 9th, with the Bitcoin API shutting on March 27 and the platform’s self-custody wallet set to go fully offline on April 1.

Reports note that the marketplace will keep Solana support and some Pack products, but many cross-chain tools will disappear. Users have been told to move assets or export keys before the cutoff dates to avoid losing access.

Why This Happened

Costs and returns drove the move. According to posts from company leadership, most engineering and infrastructure costs were tied to products that brought in only a fraction of the revenue.

Update on @MagicEden and @DiceyHQ:

It is clear we’re entering a new era where finance and entertainment merge. We are now 2 months into @DiceyHQ’s closed beta and are incredibly bullish on how things have developed (~200 users, >$15M wagered).

To give Dicey the focus it…

— Jack (@0xLeoInRio) February 27, 2026

In plain terms: a lot of work for little money. That math pushed a rethink about where to spend limited resources. One part of the business is being doubled down on: an on-chain casino called Dicey that ran a closed beta earlier this year and drew heavy betting volume.

What The Beta Showed

Dicey’s trial phase attracted around 200 users who placed roughly $15,000,000 in wagers over two months. Reports say that number convinced management the product could make stronger returns than the quieter NFT markets the company had been supporting.

The casino plans to add a sportsbook and other betting features, and the firm argues betting could be a steadier source of fees than low-volume NFT listings.

Market Effects And Reaction

The broader NFT market has been weak for months, and this shutdown is one of several signs that platforms are trimming offerings. Some collectors and builders will be annoyed, since tools and markets they used are being removed.

Others will see the move as pragmatic — a firm choosing fewer products it understands well over many it does not. Coverage from industry outlets picked up the story quickly once leadership posted details on social channels.

A Word From The CEO

Jack Lu wrote that the company was refocusing on its original Solana work and on products with clearer paths to revenue.

He described the closed beta’s results as “encouraging” and said the company will stop its NFT buyback program to free up resources for the betting product.

Featured image from www.outsideonline.com, chart from TradingView

Bitcoin is currently consolidating between $62,000 and $69,000, compressing within a narrowing range as geopolitical tensions in the Middle East inject fresh uncertainty into global risk markets. Rather than trending decisively, price action reflects hesitation. Buyers have defended the lower bound near $62K, yet repeated failures below $69K indicate that upside conviction remains limited in the current environment.

According to XWIN Research Japan, February 2026 marked a notable break in historical seasonality. Bitcoin closed the month down 14.94%, despite February traditionally ranking among its stronger periods, often delivering double-digit average gains. This year, the pattern failed. The decline was not driven by a single headline event but by structural fragilities: thin liquidity conditions, leverage imbalances across derivatives markets, and persistently weak spot demand.

At the beginning of February, Bitcoin was trading near $84,000. However, on-chain indicators already signaled underlying stress. SOPR remained below 1, confirming that coins were being spent at a loss. Realized Cap flattened, pointing to a slowdown in fresh capital entering the network. Meanwhile, the Coinbase Premium lacked consistent strength, suggesting that US spot demand had not materially returned.

Leverage Unwinds and Weak Spot Demand Undermine February’s Rebound

The mid-February drawdown was not simply a directional selloff; it was a leverage event. As the price weakened, liquidation cascades accelerated the decline, forcing long positions out of the market. Open Interest contracted sharply, confirming that the move was driven by derivatives unwinds rather than steady spot distribution. In a thin liquidity regime, these leverage resets tend to exaggerate volatility. When order books are shallow, relatively modest flows can push prices disproportionately, amplifying downside extensions.

Although Fear & Greed dropped into Extreme Fear, sentiment exhaustion alone proved insufficient to engineer a durable reversal. Capitulation without follow-through demand often produces reflex bounces, not structural bottoms.

The more structural constraint was the absence of consistent spot participation. ETF flows recorded intermittent daily inflows, but they lacked sustained weekly momentum. At the same time, stablecoin supply growth remained muted, indicating limited sidelined capital ready to deploy. Consequently, rebounds were largely short-covering rallies, driven by position unwinds rather than fresh accumulation.

Macro context reinforced this fragility. Equity weakness and dollar strength framed Bitcoin as a high-beta liquidity proxy, not a defensive asset. In February, structural supply-demand imbalances overpowered historical seasonality. A durable shift now depends on persistent spot inflows and disciplined Open Interest rebuilding.

Bitcoin Tests Weekly Support as $69K Turns Into Overhead Resistance

On the weekly timeframe, price is attempting to stabilize near the $66,000 region after a sharp rejection from the $90,000–$100,000 supply zone. The structure shows a clear shift from expansion to distribution: following the late-2025 peak, Bitcoin printed a sequence of lower highs and ultimately lost the 50-week moving average (blue), which had previously acted as dynamic support throughout the uptrend.

The breakdown accelerated once price slipped below the 100-week moving average (green), triggering a fast move toward the mid-$60K area. Notably, the 200-week moving average (red), currently rising near the high-$50K region, remains intact. This level historically defines macro bull-market structure. As long as the price holds above it, the broader cycle cannot be considered structurally broken.

Volume expanded meaningfully during the selloff, particularly on large red weekly candles, suggesting forced unwinds rather than gradual distribution. However, the most recent candles show compression and reduced downside momentum, indicating short-term equilibrium between buyers and sellers.

Technically, $69K now acts as immediate resistance, aligning with prior support turned overhead supply. A weekly close reclaiming that zone would open room toward the 50-week average. Failure to hold $62K, however, would increase the probability of a deeper test of the 200-week baseline.

Featured image from ChatGPT, chart from TradingView.com