Pyongyang, North Korea has been quietly amassing a significant amount of Bitcoin, now holding over $1.1 billion in cryptocurrencies. This surge in Bitcoin holdings has propelled North Korea to surpass countries like Bhutan and El Salvador in terms of cryptocurrency reserves. The United States remains the largest holder of Bitcoin, with 198,109 BTC valued at approximately $16.56 billion, followed by the United Kingdom with 61,245 BTC worth around $5.1 billion.
The increase in North Korea’s Bitcoin reserves has raised concerns about the source of these funds, with reports indicating that around 50% of the country’s weapons program is being funded through cybercrime and cryptocurrency thefts. The recent cyberattack on the Bybit cryptocurrency exchange, orchestrated by the state-backed hacking collective known as the Lazarus Group, resulted in the theft of $1.4 billion worth of crypto assets, predominantly Ethereum.
The Lazarus Group has been notorious for its sophisticated laundering techniques, using decentralized protocols like THORChain to convert stolen Ethereum into Bitcoin. This technique helps obscure the movement of illicit funds, making it challenging for authorities to track and intercept the stolen cryptocurrencies. North Korea has been linked to several high-profile cryptocurrency thefts in recent years, totaling over $3 billion in stolen funds.
Despite efforts by U.S. authorities to freeze and seize North Korean assets acquired through cybercrime, the decentralized nature of blockchain transactions presents challenges in stopping these illicit operations. The growing Bitcoin reserves of North Korea have raised serious global implications, with reports indicating that the country funds a significant portion of its weapons of mass destruction and missile programs through cybercrime and cryptocurrency thefts.
In response to the rising threat of cybercrime, the United States is considering establishing a Strategic Bitcoin Reserve using assets seized from criminal investigations and civil forfeitures. This move aims to solidify the role of Bitcoin in global financial strategies and combat the evolving tactics of cybercriminal organizations like the Lazarus Group. Despite international sanctions, North Korea continues to accumulate Bitcoin through illicit means, highlighting the growing use of cybercrime as an economic weapon in the digital age.