Crypto-Kim: Blockchain, Yes; Break Chains, No
The incredible speed with which technology has developed has often left a gap in the regulation of their use. The lack of regulation has become extremely visible in the field of cryptocurrencies, which can be termed as “virtual money” lacking intrinsic value like gold or state backing like fiat currencies. While they are mostly known for their speculative potential, virtual currencies are also used for practical purposes, facilitating e-commerce but also for less orthodox purposes such as illicit trafficking, terrorism, masking illicit earnings and tax evasion. North Korea has taken full advantage of the lax regulations and by using them the Pyongyang government has been able to secure luxury goods that it could not have had access to because of Western economic sanctions. As a determined and sophisticated international player in terms of cybersecurity, in a constant search for financial resources to meet its needs and ambitions, North Korea is expected to continue its efforts to identify ways in which to obtain and spend cryptocurrencies. The prospect of Pyongyang engaging in large-scale operations to avoid sanctions and using virtual currencies as a means of paying for luxury goods and services, or for easing import prohibition, is a risk that could increase in the future and needs to be addressed accordingly. Southeast Asian states are extremely vulnerable to the various types of illicit activities in which North Korea engages using virtual currencies. The ineffective approaches to regulating virtual currencies in the region create a galling systemic risk in the cryptocurrency industry that North Korea will try to make full use of. More