- South Korea introduces legislation to freeze North Korean cryptocurrency assets used to fund weapons programs.
- The bill will include measures to “track and neutralize” cryptocurrency and virtual assets stolen by North Korea through hacking and illegal means.
- South Korea also intends to establish a national cybersecurity committee supervised by the President to enhance defense against foreign hacking attempts.
South Korea is tightening its sanctions against North Korea for using cryptocurrencies to fund its illicit weapons programs. President Yoon Suk Yeol revealed preparations for a new measure targeting North Korean virtual assets on August 29.
The proposed move comes after ten months of intense consideration to reinforce South Korea’s existing sanctions against its northern neighbor.
The Bill Proposes to “Track and Neutralize” Cryptocurrency
The President returned an early draft last year, insisting on “practical measures to bolster national security.” Furthermore, the new bill now includes explicit tactics to “track and neutralize” bitcoins taken by North Korea via hacking.
President Yoon stated he will emphasize “the need to actively deter North Korea from stealing cryptocurrency, dispatching workers overseas, facilitating maritime transshipments, and engaging in other illegal activities.” These are the main funding sources of finance for its nuclear and missile development.”
These additions strengthen the current draft above its predecessor, proposed by the National Intelligence Service (NIS).
North Korea Believed to Have Stolen $1.28 Billion Last Year
The backdrop for this legislative action is Pyongyang’s increased prowess in cyber theft. According to South Korean intelligence estimates, North Korea stole $1.28 billion in Bitcoin and Ethereum in 2022 alone.
According to Yoon Han-hong of the People Power Party, roughly $52.46 million from North Korean crypto hacking groups most likely passed through South Korean bitcoin exchanges. The sheer amount of North Korea’s cyber-criminal actions tied to its missile program adds to the urgency.
Chainalysis states North Korean hackers have amassed over $3 billion in the last five years. Subsequently, the United States deputy national security adviser Anne Neuberger disclosed that cyberattacks and crypto theft fund half of North Korea’s missile program.
According to Yoon, “As North Korea opens its border, recently, its workers in China and Russia are sending the money they earned back to the regime…
Also, in many cases, North Korean hackers are using Chinese banks for exchanging cryptocurrency they stole, so there is room for cooperation with China and Russia in terms of the North Korea issue.”
South Korea’s legislative priorities go beyond this single bill. The Yoon administration intends to form a national cyber security committee to report directly to the president. The goal of this committee is to strengthen South Korea’s defenses against foreign hacking attempts.