North Korea is working on a new cryptocurrency in order to avoid international sanctions imposed by the United States and other countries. This is according to a representative for the regime that talked to VICE News.
There have been several reports discussing how North Korea was involved in crypto exchange hacks in South Korea and other countries. Apparently, the government is currently working on a digital currency that would allow Pyongyang to avoid sanctions imposed by Western countries.
As per the report, the new digital currency does not have a name yet and it would work in a similar way to Bitcoin and other digital assets. This is according to Alejandro Cao de Benos, the official in charge of North Korea’s crypto conferences.
Cao de Benos explained they are currently in the very early stages in the creation of the token. They are also studying which goods are going to give value to this virtual currency. However, he explained there are no plans to digitize the North Korean won, at least for now.
This is very similar to the virtual currency launched by the Venezuelan dictatorship. The country launched the so-called Petro that is backed by gold, diamonds and oil, among other goods produced by the country. This national cryptocurrency was developed with similar intentions behind, avoid U.S. sanctions.
Kayla Izenman, a research analyst at the Royal United Services Institute think tank, explained:
“There is absolutely no doubt that they have the technical expertise to develop and utilize almost any iteration of cryptocurrency.”
Although Bitcoin could be an option for North Korea to use, a national digital currency controlled by the country would give it more power and less exposure to other regulators around the world.
Despite the intentions of effectively building a digital currency, Venezuela is the only case in the world that created a national cryptocurrency. However, the results have been far from positive for Nicolás Maduro’s regime.
Blockchain technology is also an important topic for North Korea. Mr. Cao de Benos claimed there are several foreign companies working with the North Korean government to develop blockchain systems in different areas.
Russian companies could have a significant presence in the upcoming blockchain conference that is going to be held in North Korea. The Russian government has also been involved in different blockchain and crypto projects around the world.
North Korea, as well as Iran, Russia and Venezuela, could be working in order to create a local cryptocurrency. This would help Pyongyang avoid sanctions from Western countries.