North Korea Mines Cryptocurrency With Coal
CryptoBit News Today2 min read
Over the past year, crypto analysts have identified several North Korean-based servers running data mining operations, according to a recent report. Experts are of the opinion that they are mining cryptocurrencies, including Bitcoin, using power from coal-fired power plants. This would give the rogue nation an additional source of foreign currency. ## Surge in CCTV Traffic
Researchers have noted a jump in internet traffic linked to a few North Korean IP addresses over the past twelve months. As of now, no one has confirmed which cryptocurrencies the regime is mining, but the largest server is linked to a mining pool belonging to Bitclub Network, which has been associated with Bitcoin.
The mining operation is thought to be based in the Yanggang Province, an area known for its coal reserves and electric grid. The regime has been observed exporting coal to neighboring countries and to China, but it had become difficult to do so last year, due to stricter export restrictions. ## Explaining the Traffic Patterns
The researchers noted an unusual pattern in the types of traffic. The servers underwent several months of online activity, before going offline for weeks. After that, they went back online for several months.
The experts believe that the pattern reflects the operational cycles of coal-based power plants in Yanggang. These plants are offline while cooling or being repaired, and online while generating electricity.
The traffic comes in several bursts each day and specifically coincides with the day and night cycle in Yanggang, which indicates that the operation is based there. Experts say this traffic does not seem to be hacked, or connected to any known cyberattacks by the country. ## Providing Revenue for Sanctions-Hit Regime
This operation could be bringing in significant earnings for North Korea, even though the profits are not more than a few million dollars. If sanctions were eased, this operation could become the backbone of a lucrative crypto business.
The profits are mostly in Bitcoin, which is not subject to export restrictions, unlike coal. Bitcoin mining could therefore be seen as a potential way for the country to obtain foreign currency, at a time when it has been cut off from the international trade by several years of sanctions.
As with anything crypto, fools and crooks abound. The North Korean regime has been accused of hacking exchanges, stealing crypto wallets and laundering the proceeds. The government has yet to comment on the mining operations.
Analysts caution that even if Bitcoin mining is just a sideline for the regime, it would still be a worrying development for the crypto community, given the country's international isolation, lack of transparency and human rights record.
The possibility that North Korea could use Bitcoin mining as a vehicle to launder money, or as a kind of global money-laundering mechanism should be carefully considered, experts said.
