North Korea is a country that has been hit hard by U.S. sanctions in recent years, as the international community, and specifically the United States government attempts to push its agenda about certain policies.
These are especially in regard to human rights violations, and the North Korean regime’s intimidating nuclear program. Sanctions imposed on the North Korean government by the United States prohibit any person or company from undertaking trade with the nation.
The export of goods and services to North Korea as well as technology is also prohibited. Only select non-governmental organizations are allowed to provide some limited services, send resources and transfer humanitarian technology to the state. And as U.S. sanctions bite, the hermit nation is scurrying to find more ways to circumvent them, and apparently relying more on cryptocurrencies.
There have been reports of this happening before and now, according to an investigation carried out by Lourdes Miranda, an independent financial crimes analyst, and Ross Delston, an American attorney, the North Korean government currently has advanced cryptocurrency resources to undermine the effectiveness of U.S. sanctions.
By using major cryptocurrencies, the nation can pay for embargoed commodities from the outside world, including the United States. Lourdes and Delston revealed this via a joint statement sent to The Asian Times.
According to the duo, the North Korean situation is particularly unique because the government is willing to provide funding and get its hands dirty in finding ways to get around the sanctions. The two outlined several ways through which Pyongyang can achieve this through cryptocurrencies.
By launching its own range of cryptocurrencies and blockchain, for example, government actors can manipulate public ledger records and disguise the origin of coins, which is an important aspect of laundering crypto. Integrating this aspect into its schemes, the Democratic People’s Republic of Korea (DPRK) could use its own crypto hot wallets to transfer funds to the European market and finally into U.S. exchanges to acquire U.S. dollars.
Alternatively, the regime could start by obscuring the origin of crypto coins using multiple cryptocurrency tumbler services. They mix digital coins from clients with currency from a wide range of sources. Frequently shifting the coins and mixing them can break their linear pattern while maintaining the digital currency-type. The complexities of undertaking this can differ significantly in relation to the circumstances.
DPRK agents could then utilize Russian platforms to open and fund virtual crypto wallets. The wallets can be used to send coins to a Bulgarian platform and from there, transferred to a service based in Greece, for example.
At this stage, people who are able to provide qualifying Personally identifiable information (PII) can be hired to hold the funds or transfer them freely within EU based networks. The digital currency can then enter the United States market.
Final steps would involve sending the coins to major cryptocurrency exchanges offering crypto for fiat services. This is because most mixing services don’t provide this, due to financial market regulatory requirements imposed by governments, which most would not wish to adhere to.
Acquiring fiat from major currency exchanges would enable the DPRK to get its hands on badly needed international currencies, allowing it to continue participating in international commerce. This would provide limited buoyancy to its flagging economy.
Funding in Crypto for Top Secret Projects
North Korea, reportedly earns upwards of $100 million in fiat currency each year converting crypto into cash. The East Asian country has been observed to be taking part in numerous projects in countries such as India, the Philippines, and Malaysia.
As such, it must be getting funds for these projects in some way, since the country has been locked out of the SWIFT international money transfer system. The best guess so far has been payments using cryptocurrencies, mainly because the projects are also top-secret.
(Featured Image Credit: The Australian)
Never Miss Another Opportunity! Get hand selected news & info from our Crypto Experts so you can make educated, informed decisions that directly affect your crypto profits. Subscribe to CoinCentral free newsletter now.