Security analysts think that North Korean dictator Kim Jong-un has instructed its technical experts to mine bitcoin, demand it for ransom payments and steal the digital coins from online wallets and exchanges before cashing them in.
A few days ago, the US imposed new sanctions on North Korea over its nuclear and missiles programme, but this may have done less damage than expected. The problem here is that North Korea can partially bypass these financial restriction by using cryptocurrency, having approximately £144million in digital cryptocurrency transactions.
“The majority of international and US sanctions thus far have focused on pressure points on territorial North Korea and the North Korean regime. Those sanctions have been ongoing for years and years and years at this point, but the regime has not abandoned its drive to develop ballistic missiles or nuclear weapons,” said former top National Security Agency official Priscilla Moriuchi in a Vox interview.
In a Radio Free Asia interview, Priscilla Moriuchi said that North Korea raked in approximately 11,000 Bitcoins by employing a cunning sanction busting scheme.
If the country had monetized them when in mid-December when the prices hit all time highs, it would have made $151 million.
She also is of the belief that the regime earns more than $200 million by converting digital currencies into fiat currencies.
“While that’s not enough to fully fund North Korea’s nuclear and ballistic missile programs, it certainly doesn’t hurt.”420
“I would bet that these coins are being turned into something – currency or physical goods – that are supporting North Korea’s nuclear and ballistic missile programme,” said Moriuchi.
Ashley Shen, a security researcher that works independently has tracked three hacking groups: Lazarus, Andariel and Bluenoroff, which attacked bitcoin exchanges, and thinks that the rogue nation is responsible for the targeted raids.
The price of bitcoin has soared in recent month, rising from around $1,000 from the beginning of 2017 reaching nearly $20,000 near the end of the year.
Lee Don-geun, South Korean Internet and Security Agency director had to say on the matter: “It is a fact that North Korea has been attacking virtual currency exchanges.”
“We don’t know how much North Korea has stolen so far, but we do know that the police have confirmed the regime’s hacking attempts.”
There have been many reported hacking attempts (some with varying degrees of success) on South Korea cryptocurrency exchanges, and most of them have been traced to its northern counterpart. And in spite of the ever- growing number of sanctions imposed, North Korea seems to plan on continuing on this path.