South Korea has finalized new rules allowing courts to freeze, seize and sell Bitcoin and other cryptocurrencies to recover unpaid debts. These rules, codified in Rule 3280 promulgated by the Supreme Court on Oct. 12, will take effect on Nov. 1 and cover cryptocurrencies held on exchanges and in private wallets. Courts can order the transfer of directly held crypto before formally notifying debtors, potentially limiting opportunities to move assets beyond creditors’ reach. Creditors can ask courts to compel custodians to disclose information about targeted holdings within one week. Enforcement against self-custodied assets could remain challenging where debtors control the private keys needed to authorize transfers.
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