The sudden implosion of FTX continues to ravage crypto-dependent systems. Among the countries affected, North Korea is more vulnerable, according to Troy Stangarone. This analyst, senior director of the Korea Economic Institute of America, explained the implications of the collapse of FTX on the crypto hacking activities carried out by Kim Jong Un. North Korea has been engaged in crypto heists since its adoption of the zero-covid policy.
Zero Covid Strategy Pushes North Korea To Crypto Theft
Troy Stangarone said on The Diplomat that the North Korean regime has become addicted to crypto. During the pandemic, the country pursued a zero Covid strategy. This made it difficult to acquire the hard currency needed to finance armament programs and its trade deficit. Exports have also been curtailed, not to mention its difficulties in evading United Nations sanctions for regime-led smuggling.
The North Korean regime then had to carry out crypto thefts to compensate for hard currency losses. According to the FBI, North Korea carried out a crypto heist worth $620 million on Axie Infinity’s Ronin Bridge. And the Elliptic company accused him of hacking $100 million from the Horizon Bridge of Harmony.
Negative impacts on the country’s crypto activities
According to the analyst, the collapse of FTX does not seem to directly impact North Korean crypto activities. But due to their heavy reliance on crypto, the crash has three implications. First, the value of his crypto holdings has been reduced. Ether which has dropped drastically is the most commonly stolen crypto by North Korea.
Second, companies are now looking to improve their system following FTX’s mismanagement. North Korea, which took advantage of these loopholes in the crypto industry, will certainly encounter difficulties in the face of this strengthening of security. In addition, regulatory oversight will be greater. The corporate changes will make crypto less useful for North Korea.
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