North Korea-owned Ethereum developer sentenced to 5 years in prison for violating sanctions

Virgil Griffith, a former Ethereum developer, has been sentenced to 63 months in prison and will pay a $100,000 fine for attending a conference and helping North Korea use blockchain technology. against the economic sanctions imposed by the United States.

US District Judge Kevin Castel of the Southern District of New York announced the verdict on Tuesday. Judge Castel stated that “what is seen here is an intention, a conscious and voluntary intention to violate the sanctions regime”.and added that The crime was compounded because Griffith had a “desire to educate people about how to circumvent sanctions”..

September 2021, Griffith pleaded guilty to conspiracy to violate the International Emergency Economic Powers Acta law that prohibits US citizens from “exporting any goods, services or technology to the DPRK (Democratic People’s Republic of Korea or North Korea) without a license from the Treasury Department, Office of Foreign Assets Control (OFAC, for its English acronym)”.

North Korea-owned Ethereum developer sentenced to 5 years in prison for violating sanctions
North Korea-owned Ethereum developer sentenced to 5 years in prison for violating sanctions

early 2019, Griffith was unable to obtain permission from US authorities to travel to North Korea. But it was in April anyway and visited the capital Pyongyang for the Blockchain and Cryptocurrency Conference.

in the conference, gave presentations in a North Korean suit about how the country could use cryptocurrencies to evade sanctions and launder money. He also established methods how smart contracts could be used to help the country in nuclear arms talks with the United States.

In an attempt to reduce his sentence, Griffith’s defense team provided evidence of factors that may have caused him to act irrationally. They presented a psychological evaluation of Griffith showing that he suffered from both Obsessive Compulsive Personality Disorder (OCPD) and Narcissistic Personality Disorder (NPD).

That’s what his defense team said The OCPD and NPD diagnosis explained Griffith’s “obsession” with North Korea and it’s possibly what has made him despise warnings from friends, family and the government about unauthorized travel to the country.

in the audience, Griffith was given the opportunity to speak and stated that he was sorry for his actions.adding that the sanctions against Russia over the invasion of Ukraine “worked” and “cured” its “obsession with North Korea.”

The court seemed unconvinced that Griffith was repentant.and Judge Castel said:

“The fact is, Virgil Griffith hoped to return home as a cryptocurrency hero, admired and praised for standing up to government sanctions, for his fearlessness and nobility.”

Griffith was arrested by the FBI in November 2019, just months after returning from the conference. He had several meetings with the FBI about his trip prior to his arrest, even providing them photos of himself presenting at the conference.

North Korea has become increasingly sophisticated in using cryptocurrencies, both to circumvent sanctions and use hacks and exploits to steal millions of dollars.

In January, a Chainalysis report revealed this Nearly $400 million was stolen by North Korean hackers through ransomware and exchange hacks in 2021which employs a meticulous laundering system with decentralized exchanges and multiple cryptocurrency tumblers.

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