Sanctions or Stability: South Korea Considers How to Address North Korea's Cryptocurrency Threat

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Sanctions or Stability: South Korea Considers How to Address North Korea's Cryptocurrency Threat

Bitget-RWA2025/11/06 12:14

By:Bitget-RWA

- South Korea may reconsider sanctions against North Korea amid a $3B crypto theft linked to Pyongyang's nuclear funding, as U.S. Treasury targets 10 entities/individuals for laundering stolen digital assets. - North Korea condemns sanctions as "hostile" U.S. tactics, deepening ties with Russia while rejecting dialogue, despite Trump's openness to resuming talks with Kim Jong Un. - Blockchain analysis reveals $3B in crypto stolen by groups like Lazarus since 2022, with Australia joining U.S. sanctions agai

According to recent reports, South Korea is considering a possible revision of its sanctions on North Korea following a high-profile cryptocurrency theft,

as reported by AP

, as tensions rise between Pyongyang and Washington over North Korea’s cyber-driven financial operations. This comes as the U.S. Treasury has taken steps to penalize North Korean agents accused of laundering stolen digital currency to support its nuclear ambitions—a move North Korea has sharply criticized as

malicious hostility

On November 4, the U.S. Treasury Department revealed

new sanctions

targeting eight people and two organizations, including North Korean financial officials and companies, for their involvement in moving over $3 billion in stolen cryptocurrency since 2022.

Sanctions or Stability: South Korea Considers How to Address North Korea's Cryptocurrency Threat image 0

The illicit funds, acquired through ransomware, exchange hacks, and fraudulent IT employment, are believed to have been routed through shell firms and banking systems in China, Russia, and elsewhere to bypass international restrictions. Among those named were Jang Kuk Chol and Ho Jong Son, who oversaw $5.3 million in crypto for the state-run First Credit Bank, as well as the Korea Mangyongdae Computer Technology Company, which reportedly used Chinese brokers to hide transactions, according to an

OCCRP report

Kim Un Chol, North Korea’s vice foreign minister, denounced the sanctions as part of a “hostile” American agenda,

pledging an appropriate response

and insisting that such pressure would not change Pyongyang’s strategic direction. North Korea has long dismissed sanctions as ineffective, with Kim Jong Un strengthening ties with Russia—including sending troops and military hardware to Ukraine—while refusing to engage with Washington. Although former U.S. President Donald Trump has indicated willingness to restart negotiations with Kim, North Korea has not responded.

Blockchain intelligence firms estimate that North Korean cybercriminals, notably the Lazarus Group, have stolen close to $3 billion in cryptocurrency over the last three years, with a

$1.4 billion theft

from the Bybit exchange in 2025 standing out as one of the largest cases.

Australia has also sanctioned Lazarus

and joined the U.S. in taking action, citing the group’s significant thefts.

South Korea’s potential reconsideration of sanctions highlights ongoing doubts about the current approach’s effectiveness. While U.S. officials maintain that targeting financial intermediaries disrupts North Korea’s funding, Pyongyang argues these measures worsen tensions in the region. The North has also accused the U.S. of focusing on punitive actions rather than diplomatic solutions, even as Trump’s recent trip to Asia included calls for renewed talks.

The situation is further complicated by North Korea’s growing partnership with Russia, which serves as a counterbalance to U.S. power. Experts believe that Seoul’s measured approach may reflect a desire to address security risks while avoiding further conflict.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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