A US cryptocurrency expert is said to have advised the communist regime on how it can strengthen its economic development with blockchain. He faces 20 years in prison.
Virgil Griffith must have known that attending a cryptocurrency conference in North Korea could get him in trouble. He could soon experience firsthand how harsh the US sanctions against the country are. According to a lawsuit filed by the U.S. Department of Justice, Griffith, who works for the nonprofit Ethereum Foundation, not only traveled to North Korea without permission from the U.S. Department of State. The Federal Bureau of Investigation (FBI) also claims that Griffith is also committed to providing “services” to the Democratic People’s Republic of Korea (DPRK) in a manner that violates U.S. sanctions. He could face up to 20 years in prison. On the other hand, according to Griffith’s defender, which also includes Ethereum inventor Vitalik Buterin, he only gave a harmless lecture on open source technology based on publicly available information.
Griffith, along with around 100 others, attended the Pyongyang blockchain and cryptocurrency conference, according to the lawsuit. She also claims Griffith had told FBI investigators that the North Korean government had approved his presentation topics in advance, and a conference organizer had told him that he should “consider the potential suitability of cryptocurrency and blockchain technology for money laundering and evasion.” Highlight sanctions “.
North and South Korea’s cryptocurrency exchange?
According to the FBI, Griffith and other participants actually discussed these issues and “how the DPRK could use these technologies to become independent of the global banking system.” After that, Griffith reportedly tried to set up a cryptocurrency exchange between North Korea and South Korea. Such a transaction would have violated US sanctions.
Sanctions, unlike military ones, are diplomatic instruments of coercion that governments can use against foreign opponents. The sanctions of the United States and many other nations have imposed extensive trade restrictions on the North Korean government to limit its nuclear weapons program.
Cryptocurrencies are fascinating in North Korea
That is why the North Korean regime under Kim Jong-un, which is cut off from the global financial system, is looking for ways of economic growth that do not depend on this system. That’s why cryptocurrency and financial technology are so compelling in a broader sense, says John Park, director of the Korea project at the Belfer Center at Harvard’s Kennedy School.
Even if the economic sanctions against North Korea fell, the economy was so “chronically underdeveloped” that it would be extremely difficult to establish a sustainable national currency and expand international trade, Park says. North Korea’s leadership is excited about the potential of cryptocurrency as a tool that can help the regime achieve these goals faster without relying on traditional middlemen like the International Monetary Fund and the World Bank, Park says.
“Bitcoin as a replacement for SWIFT”
It is unclear what the North Koreans really wanted to do with Virgil Griffith. In September, the cryptocurrency news site “Decrypt” released details that an anonymous participant in the Pyongyang conference provided. The other participants were government officials, employees of the state bank, and economics professors. The North Koreans wanted “to know how to use Bitcoin to replace SWIFT,” the worldwide bank-to-bank payment system, and were also interested in using Ethereum Smart contracts to automatically enforce agreements outside the country’s borders.