Is North Korean dictator Kim Jong Un behind bitcoin’s wild price swings? That’s what some observers suggest.
Some of the biggest news in the cryptocurrency space is the spectacular recent price spikes of bitcoin and other digital currencies. Bitcoin climbed by about 20 times in value from the beginning of 2017 to its highest point, just shy of $20,000 per coin, toward yearend.
Although the price of bitcoin slumped into the start of 2018, it is nonetheless significantly higher in value than it was at this time last year. A number of factors may have contributed to the stellar gains, including the growing fervor among investors and anticipation of broader uses for digital currencies in the near future.
Possibility of Cryptocurrency Funding
TechCrunch speculates that because of massive international sanctions which have been put in place to deter North Korea from developing nuclear weapons, the regime has historically found “side businesses” to gain additional funding. One of these could be cyber-piracy. (See also: How the North Korea Economy Works.)
In this scenario, the regime gains access to digital currency holdings, work to pump up the prices of those assets, and then dispose of the coins to continue to finance its activities.
There are reasons to believe that North Korea may be behind several recent hacks aimed at stealing digital currency holdings. (See more: Can Bitcoin Be Hacked?) A spearfishing campaign which targeted bitcoin traders, a series of hacks on the South Korean exchange Youbit, and other hacks on South Korean targets may all have been orchestrated by the North Korean government.
TechCrunch says the regime is “actively hacking the bitcoin and cryptocurrency ecosystem in a push to gain as much cryptocurrency for the regime as possible.”
But there could be more to the story than just these thefts. Experts say the cryptocurrency gains in the past several months were fueled by a flurry of activity in Asian markets.
The rise of digital currencies in the region “is certainly fueled by a desire for quick returns, a lack of access to strong investment opportunities,” and “the instability and uncertainty of North Korea,” according to TechCrunch.
Through its actions – including the continued destabilization of international markets and the hacks of digital currency exchanges and traditional banks – the North Korean regime may be aiming to drive up the price of digital currencies so it can take advantage of the relative anonymity these investments (or illicit holdings, as the case may be) afford. (See also: Bot Activity Plays Major Role in Cryptocurrency Price Swings.)
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