Ethereum developer arrested for passing knowledge about blockchain to North Korea

Source: Wit Olszewski - Shutterstock

• Virgil Griffith recently worked at the Ethereum Foundation as a developer, but was arrested at Los Angeles Airport on November 28, 2019.
• The reason for this is that he travelled to a conference in North Korea and passed on his knowledge about the use of blockchain technology.

North Korea is regarded as a close partner of China and thus as a direct competitor of the United States in the areas of economy, military and also in the area of blockchain technology. The Ethereum developer Virgil Griffith travelled to the controversial country North Korea despite several warnings and is said to have attended a conference on cryptocurrencies.

Griffith is arrested at the airport for passing on knowledge about the blockchain

Griffith was unceremoniously arrested on Thanksgiving Day, November 28, 2019, at Los Angeles airport, according to the New York Southern District Attorney’s Office. Griffith is said to have attended a North Korean conference in April, the Pyongyang Blockchain and Cryptocurrency Conference. He tried to get clearance to attend, but was not granted.

Nevertheless, he is said to have attended the conference without public permission. He is said to have entered via neighbouring China, although he is said to have received several warnings. The Deputy Attorney General for National Security states in the statement that he has passed on valuable knowledge. Among other things, he is accused of infiltrating the sanctions against North Korea by passing on knowledge about the use of the blockchain:

Despite receiving warnings not to go, Griffith allegedly traveled to one of the United States’ foremost adversaries, North Korea, where he taught his audience how to use blockchain technology to evade sanctions.

The complaint further describes that Griffith allegedly presented how North Korea can use cryptocurrencies to launder money and avoid sanctions:

At the DPRK Cryptocurrency Conference, GRIFFITH and other attendees discussed how blockchain and cryptocurrency technology could be used by the DPRK to launder money and evade sanctions, and how the DPRK could use these technologies to achieve independence from the global banking system.

No name of a specific cryptocurrency such as Bitcoin or Ethereum appears in the affidavit. Griffith merely claims that he passed on knowledge about the “Cryptocurrency 1”. Griffith is also said to have tried to obtain another citizenship abroad. The case is currently being examined by the Department of Terrorism and Counterintelligence.

United States does not want to lose pioneering role in blockchain sector

This case clearly shows how valuable knowledge is in the Blockchain and Fintech sector and that it is protected with all its might. Regardless of the outcome of this case and the extent to which the facts presented are true, many countries are working hard to drive developments in this area forward.

Bitcoin bull and multiple billionaire Mike Novogratz pointed out in several Intervies that the US could lose its pioneering role in blockchain technology to China if regulators do not make further progress. He described:

 If the US regulators don’t allow for fintech innovation, the Chinese will eat our lunch. Crypto and blockchain will be part of the financial and consumer infrastructure in the future.

A new report by the Tokyo-based research company Astamuse shows that China has filed more than 7,600 blockchain-related patent applications in 2009 to date, clearly outperforming the competition. The Chinese filed about three times as many applications as the Americans and are responsible for 60% of the applications filed in the USA, China, Japan, South Korea and Germany.

This clearly shows that China sees great potential in the technology and is strongly promoting its further development. It remains to be seen what tangible impact the launch of the digital yuan will have on China and the global economy in the first quarter of next year.

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