N. Korea’s 4Cs: Crypto-Currency-Cyber-Crime

Despite recent diplomatic progress with the US, North Korea remains the world’s most significant weapons of mass destruction (WMD) proliferation threat. Now 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. 
 
The UN Security Council’s Panel of Experts on North Korea has suggested that crypto-currencies offer North Korea ‘more ways to evade sanctions given that they are harder to trace, can be laundered many times and are independent from government regulation’.
 
In general, North Korea could seek to use crypto-currencies as part of its proliferation financing efforts through:
 
  • Fundraising: To sustain its ongoing needs for cash, North Korea may obtain crypto-currencies with the aim of converting them to fiat currencies in the short term.
  • Stockpiling: North Korea could accumulate reserves of crypto-currencies with the objective of eventually spending them or converting them into fiat currency at some point in the future.
  • Circumvention: North Korea could use crypto-currencies to pay directly for goods, services and resources that are explicitly prohibited by international sanctions.
Southeast Asia has long been vulnerable to North Korea’s WMD proliferation financing and sanctions-evasion activities, given its proximity to North Korean proliferation networks and the availability of sophisticated trade and finance infrastructure. 
The region is now vulnerable to North Korea’s crypto-currency-enabled activity as well, and important gaps remain.
For example, gaps in local regulatory frameworks could allow North Korea, or other actors, to exploit crypto-currency exchanges and other related platforms. 
 
Since Southeast Asia also features a nascent but burgeoning cryptocurrency industry, local law enforcement agencies will likely require further knowledge and resources to ensure that they can successfully respond to crypto-currency-related criminal activity over time should the local crypto-currency industry continue to grow in scale. 
 
By taking steps such as developing effective regulatory frameworks and leveraging public–private partnership initiatives, countries in the region can mitigate North Korea’s crypto-currency activity successfully.
 
RUSI
 
You Might Also Read
 
The Mysteries Of Crypotocurrencies:
 
 
 
« Cognitive Science Can Explain Why Fake News Works
Deep Learning & Cybersecurity »

Perimeter 81

Directory of Suppliers

ZenGRC

ZenGRC

ZenGRC - the first, easy-to-use, enterprise-grade information security solution for compliance and risk management - offers businesses efficient control tracking, testing, and enforcement.

DigitalStakeout

DigitalStakeout

A simple and cost-effective solution to monitor, investigate and analyze data from the web, social media and cyber sources to identify threats and make better security decisions.

BackupVault

BackupVault

BackupVault is a leading provider of completely automatic, fully encrypted online, cloud backup.

Cyber Security Service Supplier Directory

Cyber Security Service Supplier Directory

Free Access: Cyber Security Service Supplier Directory listing 5,000+ specialist service providers.

IT Governance

IT Governance

IT Governance is a leading global provider of information security solutions. Download our free guide and find out how ISO 27001 can help protect your organisation's information.

CYRIN

CYRIN

CYRIN® Cyber Range. Real Tools, Real Attacks, Real Scenarios. See why leading educational institutions and companies in the U.S. have begun to adopt the CYRIN® system.

MIRACL

MIRACL

MIRACL provides the world’s only single step Multi-Factor Authentication (MFA) which can replace passwords on 100% of mobiles, desktops or even Smart TVs.

XYPRO Technology

XYPRO Technology

XYPRO is the market leader in HPE Non-Stop Security, Risk Management and Compliance.

Perimeter 81

Perimeter 81

Perimeter 81 is a Zero Trust Network as a Service designed to simplify secure network, cloud and application access for the modern and distributed workforce.

Authentic8

Authentic8

Authentic8 transforms how organizations secure and control the use of the web with Silo, its patented cloud browser.

Rollbar

Rollbar

Rollbar is a full-stack error monitoring platform for web and mobile applications. We help developers find and fix bugs fast. Built by developers for developers.

Metasploit

Metasploit

Metasploit penetration testing software helps find security issues, verify vulnerabilities and manage security assessments.

Vade Secure

Vade Secure

Vade Secure provides protection against the most sophisticated email scams such as phishing and spear phishing, malware and ransomware.

StartACyberCareer.com

StartACyberCareer.com

We are a group of cybersecurity professionals and trainers who are passionate about the field of cybersecurity and the career opportunities that it provides.

Thridwayv

Thridwayv

Thirdwayv helps your enterprise realize the full potential of loT connectivity. All while neutralizing security threats that can run ruin the customer experience - and your reputation.

SecZetta

SecZetta

SecZetta provides third-party identity risk solutions that are easy to use, and purpose built to help organizations execute risk-based identity access and lifecycle strategies.

Evolution Equity Partners

Evolution Equity Partners

Evolution Equity Partners is an international venture capital investor partnering with exceptional entrepreneurs to develop market leading cyber-security and enterprise software companies.

Hunton Andrews Kurth

Hunton Andrews Kurth

Hunton Andrews Kurth LLP serves clients across a broad range of complex transactional, litigation and regulatory matters. Practice areas include Privacy and Cybersecurity.