Seized cryptocurrency is stored and eventually auctioned off to fund public services or compensate victims.

From Cointelegraph

October 26, 2024 07:35 AM:

Law enforcement authorities are confiscating cryptocurrency from cybercriminals, but what happens to it next? The seized digital assets are stored in either offline or online wallets until they are auctioned off. After the auction, the proceeds are used to fund public services or returned to victims of cybercrime.

Read more at Cointelegraph: What happens to seized cryptocurrency?