On September 10th, Un-Chul Yang, Emeritus Research Fellow gave a presentation on "Cyber Financial Crime of North Korea and International Cooperation and Countermeasures" at the 18th Colloquium.

The discussion was moderated by Seong Chang Cheong, Director of the Center for Korean Peninsula Strategy 

Overcoming difficult economic situations and social problems requires much capital, but North Korea has minimal internal resources. The North Korean Won has lost its role as a means of external payment due to economic sanctions that make it difficult to export natural resources or goods, and the country has been using the Chinese Yuan or the U.S. dollar as payment for trade and has been engaged in illegal economic activities since the 1970s to acquire U.S. dollars. While the illicit activities have largely ceased due to diplomatic pressure and high transaction costs, the group has expanded its business scope to include cyber gambling operations, cyber attack agencies, and ransomware attacks, and is expected to focus on hacking the most valuable cryptocurrencies.

North Korea has developed specialized cyberwarfare units through the creation of various cyber warfare training institutions, and while its initial focus was on espionage against South Korea and other adversaries, as international sanctions intensified following North Korea's nuclear test, North Korea focused on cyberfinancial crime as a new source of revenue, as it is highly lucrative and anonymous. In the 2020s, North Korean cybercrime focused on cyberespionage and hacking for financial gain, which is believed to have helped sustain the North Korean economy and fund its nuclear and missile programs. The expansion of the cryptocurrency market has led to an increase in North Korea's theft of digital assets, but the scale of this theft is likely to increase due to traceability limitations, and it is likely that stolen funds to be used to fund weapons development and procurement rather than for civilian purposes. North Korea will likely continue to attempt to convert cryptocurrencies into legal tender, reinforcing the regime's image of scientific and military superiority and demonstrating to the North Korean population that it is technologically capable of competing with the world's great powers. This, in turn, has the potential to positively influence North Korea's regime and convey the psychological fear of cyberattacks to South Korea. A concerted international response is needed, including sanctions against North Korean hackers, increased law enforcement, and enhanced cybersecurity to counter hacking.