Ethereum Foundation researcher Virgil Griffith has been indicted by a court in New York for conspiracy to violate the International Emergency Economic Powers Act.
Helping North Korea get around sanctions
The charges related to Griffith’s trip to North Korea, during which he is accused of giving a presentation explaining how to use cryptocurrencies and blockchain technology to get around sanctions. He was arrested in late November 2019.
The indictment, filed on 7th January, by the United States District Court for the Southern District of New York, alleges Griffith gave the presentation along with other people, at least one of whom is also expected to be arrested and indicted in New York.
North Korea is currently subject to extensive international sanctions, due to its illegal weapons of mass destruction research and extensive human rights abuses. Its regime has shown great interest in cryptocurrencies and blockchain’s potential to allow it to circumvent those sanctions.
The world’s hacker state
Despite its popular image as a backward, technologically illiterate nation, North Korea has invested heavily in attracting disgruntled hackers and tech experts from other countries, even holding blockchain and crypto conferences in the capital Pyongyang (read more).
North Korean state-sponsored hackers are suspected to be responsible for many of the attacks on institutions and businesses in South Korea and the west, especially cryptocurrency exchanges, and those attacks involving ransomware demanding crypto payments.
In August 2019, FortuneZ reported the United Nations had estimated North Korea had netted around $2 billion from hacking banks and cryptocurrency exchanges (read more). In September 2019 it was also reported that North Korean leader Kim Jong-un has ordered his minions to create a North Korean cryptocurrency that will be “more like bitcoin or other cryptocurrencies” (read more).
Naivety or something more sinister?
The International Emergency Economic Powers Act, which was introduced in 1977 and gives the president the power to regulate international trade during times of a national emergency coming from abroad. If Griffith is found guilty of violating it, he faces up to 20 years is prison.
Griffith has attracted some high profile supporters, including Ethereum founder Vitalki Buterin, who has pointed out that Griffith’s presentation only included publicly available information about open-source software, there was no advanced tutoring about things like hacking, and that he made no personal gain from the trip to North Korea.
Others have, however, reminded people that the average North Korean has no access to the internet, and little concept of what it is, let alone any potential interaction with cryptocurrencies or blockchain. Thus the only possible beneficiaries of Griffith’s trip would be the North Korean regime – one which is widely perceived to be brutally oppressing 25 million people and constantly threatening its neighbours with nuclear annihilation.