In Brief
North Korea “Directly Financing” Nuclear Program Using Crypto

North Korea is most likely funding its nuclear weapons program using cryptocurrency, according to a report by a British defense thinktank. The scale of state-orchestrated cryptocurrency hacking activities makes the nuclear connection highly likely.

“Given the large amounts of cryptocurrency we’re looking at from these exchange hacks and the possibility of more coming from mining operations, it is reasonable to assume that the money may be directly financing North Korea’s WMD program,” Kayla Izenman, coauthor of the report, told The Independent newspaper. The report says South-East Asia needs to regulate its growing cryptocurrency sector to resist North Korea’s operations in the area.

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The borderless nature of cryptocurrency offers a major advantage for North Korea’s government, as it can be moved seamlessly in and out of the country. That means it dodges the economic sanctions placed on the state. Negotiations between President Trump and North Korean leader Kim Jong-Un broke down in February when Trump refused to consider removing sanctions.

North Korea holds more than $670 million in cryptocurrency.

A report by the UN Security Council in March estimated that North Korea held more than $670 million in cryptocurrency. Hundreds of millions of dollars of that total has been acquired through hacking, according to a report by security firm FireEye.

North Korea’s top hacking team, Lazarus, has been identified by the FBI for yearsand held responsible for the WannaCry ransomware attack in 2017 that affected more 200,000 computers. A team labelled APT 38, believed to be part of Lazarus, has been connected to cryptocurrency exchange hacks in South Korea and Japan. One hacker in particular, named Park Jin Hyok, is currently wanted by the FBI: his 176-page indictment includes allegations of attempting to steal more than $1 billion through hacking.