North Korea Could Exploit Cryptocurrency to Fund WMD Programme
Experts warn that North Korea could potentially be using cryptocurrencies such as Bitcoin to evade sanctions.
A report by the Royal United Services Institute (RUSI) has warned that North Korea’s hackers could be generating cash for the rogue state’s nuclear weapons programme by exploiting cryptocurrency.
Potentially, North Korea could cash out its cryptocurrency into fiat currencies such as the euro, yuan, yen or US dollars,, thus enabling it to fund its nuclear and missile ambitions.
The 66-page report says: “North Korea has gone to extremes to raise funds and evade international sanctions, recently expanding these efforts to include the exploitation of crypto-currencies such as Bitcoin. Crypto-currencies likely play only a peripheral role in North Korea’s overall fundraising and sanctions-evasion activity.
“However, the sophistication of North Korea’s broader cybercrime operations and its general demand for ongoing financial resources present the risk that its crypto-currency activity could become a sustained security challenge, particularly as international sanctions lead North Korea to seek financial lifelines outside the mainstream sector.”
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For years the reclusive state has been sanctioned by the United Nations, the United States and other countries over its nuclear missile development activity. It has also been accused multiple times of using cyberattacks as an alternative form of revenue to continue its nuclear programmes.
“North Korean networks have engaged in fundraising and have evaded trade and financial restrictions through the use of front companies, agents and deceptive financial techniques at banks across the region.”
According to the study, South East Asia, with its thriving cryptocurrency sector, is vulnerable to such efforts to evade sanctions and drive the regime’s WMD programme.
The report urged Southeast Asian countries to take more measures to reduce their vulnerabilities. It recommended that they asses the risks and weaknesses in relation to North Korea, coordinate a regional regulatory response, and strengthen law enforcement training to support this.