Whether this is good news for Bitcoin or bad, one thing is for certain – both sides of the Bitcoin fence have just found some fuel for the fire. Here’s one piece of news that is anything but indifferent…
via Zero Hedge
Fresh off the news of North Korea claiming that the United States has declared war due to U.S. President Trump’s military positioning and contentious rhetoric, a report from FireEye has suggested that the DPRK may be mining something other than coal.
With tensions at an all-time high, North Korea is looking towards new means of pursuing their economic and defensive goals, and following increased cyber-attacks on South Korean cryptocurrency exchanges, it may be possible that North Korea is eyeing bitcoin as a hedge against geopolitical turmoil or even a means of skirting sanctions.
While North Korea has only limited access to petroleum due to increased sanctions and zero proved reserves of its own, the country isn’t without resources. South Korean estimates suggest a possible trillions of dollars’ worth of rare earth minerals waiting to be dug up. These include iron ore, zinc, copper, graphite, gold, silver, magnesite, and approximately $9.7 trillion worth of coal and limestone.
North Korea’s increased belligerence, however, has put a damper on hopes to rebuild the country’s mining sector. As North Korea became increasingly aggressive, the UN began placing bans on the country’s metal exports. And this year, following the increase in weapons testing, the UN upped the restrictions, including fresh bans on coal, iron, and iron ore exports, with China soon following suit.
Now, North Korea is completely shut off from, or with very limited access to the import or export of nearly every conceivable commodity.
Many countries have even imposed harsher financial sanctions on North Korea as global pressure for action intensified. Japan and China have suspended all North Korean transactions and on Tuesday, September 26, the United States imposed greater sanctions, targeting North Korean financial institutions and regime members acting as representatives for the country’s banks in China, Russia, Libya and the United Arab Emirates
So not surprisingly, Kim Jong-Un is looking for a solution, and cryptocurrencies seem to have peaked his interest.
King Jong-Un’s regime is certainly no stranger to cryptocurrencies. Between 2013-2015, the country hacked South Korean bitcoin exchanges, stealing approximately 100-million won (nearly US$90,000) in Bitcoin every month. Additionally, the country was linked to the Lazraus Group which was reportedly behind the WannaCry ransomware that infected over 200,000 computers across 150 countries.
With the country’s tech-smart regime, and coal exports banned, North Korea may have found a use for its most abundant resource – bitcoin mining.
Recorded Future, an intelligence research firm backed by Google Venture and In-Q-Tel (a venture capital firm funded by the CIA), released a report on North Korean internet activity, including what was identified as the start of bitcoin mining by users on May 17.
In an interview with VOA Korean, Priscilla Moriuchi, the director of strategic threat development at Recorded Future explained: “We weren’t able to determine the volumes, like how many bitcoin they can generate per certain time period. We could just see activity.” Moriuchi added that the intelligence firm had two hypotheses regarding the activity – the first being a group connected to the government, the other being an individual who had access to the internet.
Speculation leans to a connection to high-ranking officials in Kim Jong-Un’s regime, Moriuchi noted. Due to the limited access individuals have to the internet in North Korea, and especially the lack of expensive equipment necessary to pull off such a feat, it is likely that the government played a significant role in the mining activity noted by Recorded Future and In-Q-Tel.
North Korea’s biggest trading partner and de facto leader in the Bitcoin world, China, may also play some role in this developing story.
The founder of Bitcoin NYC Meetup, Jonathan Mohan, noted: “It wouldn’t surprise me if, perhaps, hypothetically, North Korea were to have pre-existing business relationships in China that wouldn’t mind purchasing bitcoin from them, and then just disseminating it to the Chinese market as you would with any other bitcoin.”
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