South Korea is aiming to significantly enhance sanctions against North Korea by introducing a revised bill initially announced in November 2022. This bill, as per local news reports, was revised under the direction of Yoon Suk Yeol to incorporate “practical measures for enhancing national security.”
The revised bill proposed by the South Korean government includes provisions for tracking and freezing North Korean cryptocurrency assets. South Korean authorities argue that North Korea utilizes these crypto assets to fund various weapons programs, including its nuclear initiatives. The initial version of this bill was introduced in November 2022 but was later withdrawn for adjustments through a Presidential decree.
The new bill, which targets Pyongyang’s weapons program, is the result of 10 months of deliberation and consultation among various South Korean government agencies, according to sources familiar with the matter. It contains explicit provisions aimed at tracing and neutralizing cryptocurrencies and other virtual assets stolen by North Korea and North Korea-backed hacker groups, such as the Lazarus Group.
South Korean President Yoon Suk Yeol issued instructions for the revision of this bill, which is expected to augment South Korea’s existing sanctions against its neighbouring country. Government sources indicate that President Yoon Suk Yeol deemed it imperative to urgently address the country’s cybersecurity framework.
South Korea’s National Intelligence Service reports that North Korean hackers have pilfered more than $180 million in cryptocurrency during the first half of 2023 alone. The country, especially the notorious Lazarus Group, has been linked to a growing list of cryptocurrency hacks and attacks that have sent shockwaves through the industry. According to Chainalysis, North Korea and the Lazarus Group have stolen approximately $3 billion in cryptocurrency over the past five years.
Additionally, South Korean intelligence data suggests that North Korea acquired $1.7 billion worth of cryptocurrency in 2022 alone, primarily in Bitcoin and Ethereum. This surge in cybercrime proceeds has coincided with an escalation in missile tests by the North Korean regime, which conducted over 90 cruise and ballistic missile launches the previous year and successfully tested a solid-fuel intercontinental ballistic missile in April.
The Lazarus Group is strongly suspected of orchestrating some of the most devastating and high-profile cyberattacks in the cryptocurrency realm. A recent example includes the hack of CoinsPaid, an entity linked to the crypto payment processor Alphapo, which disclosed losses of $37 million due to an exploit in July.
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