Report

Upholding North Korea sanctions in the age of decentralised finance

This report from UK think tank RUSI forms part of a series of research projects to understand and mitigate obstacles to UN sanctions implementation.

This paper aims to examine cryptocurrency mixers’ distinct technical, legal and regulatory dimensions and the challenges they pose to the sanctions regime.

The paper provides detailed background information on North Korea’s cyber-criminal statecraft, focusing on North Korean actors’ use of mixers to launder illicitly obtained cryptocurrency.

This paper forms part of a series of research projects funded by the US Department of State to understand and mitigate obstacles to UN sanctions implementation. It aims to examine cryptocurrency mixers’ distinct technical, legal and regulatory dimensions and the challenges they pose to the sanctions regime.

The paper provides detailed background information on North Korea’s cyber-criminal statecraft, focusing on North Korean actors’ use of mixers to launder illicitly obtained cryptocurrency. It takes stock of the government response to date, concluding that while actions against non-compliant virtual asset platforms have been effective individually, the campaign’s overall impact on North Korea’s laundering capacity has been limited. It also seeks to grapple with the unintended consequences of interventions, some of which have yet to manifest fully.