Understanding Crypto’s Role In Funding The North Korean Regime

Anyone with even a passing familiarity with geopolitics understands that North Korea remains a pariah on the world stage. Its repressive government has threatened nuclear war and widespread sanctions have cut the nation off from virtually all trade or foreign aid.

That leaves precious few options when it comes to providing the rogue nation with the funding it needs to carry out its agenda. Apparently, cryptocurrency crime is one area where Pyongyang can still get its hands on some quick cash.

Breaking down the heist

Cybercrime can take on various forms, and there’s no universal method by which North Korea is reportedly using it to support its military and other aspects of the government. Nevertheless, the United Nations believes that such illicit activity — particularly involving digital currency trades — is responsible for funding roughly one-third of the country’s entire missile program.

In just the first nine months of this year, experts believe North Korea has swindled a staggering $1 billion from cryptocurrency exchanges. Only a paltry $30 million of that sum has reportedly been recovered since the decentralized nature of crypto trades makes it incredibly difficult to track origins and destinations.

The role of Office 39

While crypto crime might be a relatively new undertaking for North Korea, its government has long relied on a global crime ring to rake in money. Most of these schemes fall under the purview of a shady entity known as Office 39.

This organization has spent decades dealing in narcotics, counterfeit goods, weapons, endangered animals, and pretty much anything of value that it can obtain. This shadow economy has been profitable, but the cloistered country is obviously at a disadvantage when it comes to accessing and selling illicit goods.

Cybercrime inherently negates that problem, which seems to be a game-changer for North Korea.

Chris Agee November 15th, 2022

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