U.S. Admiral acknowledges North Korea’s potential missile financing via stolen crypto, Senator Warren raises alarm

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U.S. Senator Elizabeth Warren

26th March 2024 – (Washington) U.S. Indo-Pacific Command Chief, Admiral John C. Aquilino, responded to Senator Elizabeth Warren’s concerns in a recent Senate hearing regarding North Korea’s capabilities to finance intercontinental ballistic missiles. The Democratic senator asserted that Pyongyang could potentially fund over 56 such missiles using the $1.7 billion in cryptocurrencies they allegedly purloined last year.

Admiral Aquilino, confronted with the magnitude of the sum, acknowledged that the figure did not come as a surprise. The Democratic senator’s commentary shone a spotlight on North Korea’s notorious crypto malware factions, including the state-backed Lazarus Group and the sanctioned crypto mixer Sinbad, which have been identified by the US Treasury for their illicit undertakings.

Senator Warren articulated her apprehensions about the use of cryptocurrency in enabling malevolent actors. “The crypto domain is a conduit for rogue nations, terrorists, and criminal syndicates to bolster their operations, ushering in a level of financial manoeuvrability unprecedented in history,” she remarked.

Nonetheless, the blockchain analysis company Chainalysis reported a significant downturn in the sum directed to crypto mixers from illicit sources in the past year, suggesting effective law enforcement and regulatory measures may be having an impact.

The senator’s critique of the digital currency landscape extended beyond international borders, highlighting domestic vulnerabilities. She referenced the “pig butchering” scams—a term derived from Southeast Asian fraud schemes that fatten victims’ trust before financially slaughtering them—stating over 40,000 US citizens fell prey last year, with losses exceeding $3.5 billion.

Warren emphasised the staggering scope of crypto crime, citing research that estimated criminal entities have siphoned and laundered upwards of $75 billion in cryptocurrency in the past four years alone.

In response to these concerns, Senator Warren advocated for the Digital Assets Anti-Money Laundering Act (DAAMLA), a bipartisan initiative co-sponsored by 20 senators. This legislation aims to strengthen anti-money laundering provisions and enforce stricter regulatory compliance on digital asset stakeholders.

Her push for DAAMLA emerges in a context of heightened scrutiny over cryptocurrency regulation, especially after a devastating terrorist strike in Israel last October, linked to Hamas, which resulted in over 1,200 Israeli casualties.

With these developments, Senator Warren advances her agenda amidst a challenging re-election campaign, facing a pro-crypto Republican adversary, John Deaton, who represents a contrasting vision for the future of digital currencies.