North Korea Allegedly Mining Bitcoin With Excess Coal

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Earlier this week, Recorded Future and non-profit security organization Team Cymru released a joint report revealing that the North Korean government has been mining bitcoin to avoid international sanctions.  “Before then, I haven’t seen any activity indicating that [the North Koreans] were interested in Bitcoin,” Priscilla Moriuchi, Recorded Future’s director of strategic threat development, told the Washington Post in an interview.



Since January of this year, North Korea has consistently been suspected of hacking into South Korean bitcoin exchanges and wallet trading platforms by analysts and security firms.

Based on the report of security research firm FireEye, as many as five security breaches of South Korean bitcoin service providers and trading platforms were tied back to North Korea.

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As Yaya Fanusie, a former CIA counterterrorism analyst, noted during an interview, over the past three years, the hacking tools and technologies of North Korea have become significantly advanced and sophisticated.

More to that, North Korean hackers tend to target emerging and trending technologies such as bitcoin, in order to maximize profit and generate revenue using unorthodox methods.

Fanusie further emphasized that the hacking activities of North Korea in regards to bitcoin and cryptocurrencies are more difficult to track and analyze.

He explained that the CIA and other government agencies have developed efficient and innovative tools to target traditional banking systems but are relatively unfamiliar with bitcoin and its technical intricacies.

“North Korea using these technologies is not exactly a loophole to the sanctions — that could be overstating the power of bitcoin itself. But you have a cat-and-mouse game evolving, and this is just the type of emerging technology that the [U.S. intelligence community] needs to develop expertise to understand. We’re good at tracking traditional banking, but bitcoin is not a Swiss bank,” said Fanusie.

Various report suggest that the North Korean government is initiating bitcoin mining operations to utilize its excess supply of coal. Due to its ongoing conflict with the US and its allies, the UN imposed stronger sanctions against North Korea, restricting its shipping and international sale of coal and other resources.

As a result, researchers believe that North Korea is allocating its resources which the country can no longer sell to bitcoin mining, to create a more liquid asset that can be sold and traded overseas.

FireEye researchers noted that the North Korean government targeting cryptocurrencies which are growing at an exponential rate in terms of market cap, value, price, and user base, was expected. In the upcoming months, as sanctions against North Korea and its trades with a limited number of countries become restricted, it is likely to see increased mining activities from the regime.

“It should be no surprise that cryptocurrencies, as an emerging asset class, are becoming a target of interest by a regime that operates in many ways like a criminal enterprise.

While at present North Korea is somewhat distinctive in both their willingness to engage in financial crime, and their possession of cyber espionage capabilities, the uniqueness of this combination will likely not last long-term as rising cyber powers may see similar potential,” wrote the FireEye researchers.


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