North Korea, Cryptocurrency, and Cyberattacks

    On Wednesday, February, 17th the U.S. The Justice Department and other federal officials have identified and indicted three North Korean computer programmers for committing a series of cyberattacks. Investigations show that the alleged members intent was to hack a variety of companies and banks in over a dozen countries. The hackers were part of a long-lasting plot to steal upwards of $1.3 Billion for North Korea's capital, Pyongyang (Mangan, 2021).

    In past years, North Korea has shifted their approach to criminal activity by utilizing cryptocurrency through cryptocurrency apps, software attacks, and other forms of cyberattacks. Two of the three criminals that were indicted for hacking and fraud charges were unheard of before the recent attacks. The other man, Park Jin Hyok, had been charged in 2018 for allegedly assisting in a 2016 attack that stole $81 million at the Federal Reserve Bank of New York from Bangladesh's account (McMillan and Viswanatha, 2021). In conjunction, experts have claimed that between 2019 and the end of 2020 roughly $316.4 million in crypto assets had been stolen by North Korean criminals and used for the regime's counterfeiting of currency, and drug smuggling and distribution (Akhtar, 2021).

    These North Korean schemes have been quite clever and unique because of the inability to regulate cryptocurrency at any level. In 2017, the state created a currency similar to the popular bitcoin call Marine Chain. Marine Chain lets investors buy digital money or tokens that are equivalent to fractions of stakes in maritime vessels (Nakashima, 2021). Eventually, the currency was taken off the web because it was found to be fraudulent. The Marine Chain was a success for North Korea allowing them to gain immense funding while evading sanctions from countries like the U.S. North Korea has been seen laundering cryptocurrencies from hacks through brokers in China to acquire hard currencies such as the U.S. dollar. In addition to stealing crypto, the nation has malware to mine currency and send them to North Korea (Liebkind, 2020). From unpredictable price fluctuations to technical glitches and hacking, it is frightening to see how dictatorships can manipulate a currency and use it as a modern day weapon.   

    The motives of North Korea's approach to cryptocurrency and cyberattacks are no mystery. Continuous years of financially straining sanctions and political discrepancies from global superpowers forced the nation to adapt. In turn, while being cut off from the world's global economy and hard currency Kim Jong Un's regime can still strengthen their military, terrorize the world, and build wealth. From decentralization and virtually no oversight, crypto's like Bitcoin are an easy way to avoid foreign authorities and promote rogue agenda.

 

References:

McMillan, Robert, and Aruna Viswanatha. “North Korea Turning to Cryptocurrency Schemes in Global Heists, U.S. Says.” The Wall Street Journal. Dow Jones & Company, February 17, 2021. https://www.wsj.com/articles/u-s-authorities-charge-north-koreans-in-long-running-hacking-scheme-11613581358. 

DanMangan. “North Korean Hackers Charged in Massive Cryptocurrency Theft Scheme.” CNBC. CNBC, February 17, 2021. https://www.cnbc.com/2021/02/17/north-korean-hackers-charged-in-massive-cryptocurrency-theft-scheme.html. 

Akhtar, Tanzeel. “UN Says North Korea Funded Nuclear Weapons With Crypto Hacks in 2020: Report.” CoinDesk. CoinDesk, February 9, 2021. https://www.coindesk.com/un-says-north-korea-funded-nuclear-weapons-with-crypto-hacks-in-2020-report. 

Nakashima, Ellen. “U.S. Accuses North Korean Hacker Spies of Conspiring to Steal More than $1.3 Billion in Cash and Cryptocurrency.” The Washington Post. WP Company, February 17, 2021. https://www.washingtonpost.com/national-security/north-korea-hackers-banks-theft/2021/02/17/3dccf0dc-7129-11eb-93be-c10813e358a2_story.html. 

Liebkind, Joe. “What Is North Korea's Role In Bitcoin and Does It Affect Prices?” Investopedia. Investopedia, January 23, 2021. https://www.investopedia.com/news/what-north-koreas-role-bitcoin/.