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How North Korea is Using Bitcoin to Defeat UN Sanctions

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Several reports have surfaced that suggest North Korean hackers are running a highly sophisticated cryptocurrency operation in order to usurp sanctions and amass a war chest of liquid financial assets.

Unlike major superpowers like the United States and China, North Korea has no major central bank with the ability to print money that holds any value. Alternatively, they’ve turned to building a full scale hacking, mining and laundering operation to essentially print cryptocurrency out of thin air.

It’s unknown how long Pyongyang has been developing this cryptocurrency operation, but it does appear to be highly effective. According to a research report from cybersecurity firm FireEye Inc., which is famous for their involvement in working for the Clinton Foundation, since April 2017, there has been major hacks of South Korean cryptocurrency stashes.

Another disturbing development is that the timeline of North Korea’s amassing cryptocurrency seems to correlate with the rally in bitcoin and ethereum.

South Korean intelligence has verified that North Korea runs what it calls an ‘army of hackers’ that aim to commit serious hack attacks that aim to steal cash and cryptocurrencies. Rather than traditional state-sponsored cyber armies, which traditionally focus on committing espionage and being able to paralyze the infrastructure of their enemies, North Korea’s focus remains on stealing monetary assets.

North Korea’s Reconnaissance General Bureau, which directly reports to Kim Jong Un, handles cyber operations from espionage to network disruptions and employs an estimated 6,000 officers, according to a 2016 report from the International Cyber Policy Centre at the Australian Strategic Policy Institute.

South Korea is the most frequent target for North Korean targets. Experts believe that this is because of their proximity and shared language with the North. Intelligence reports have suggested that English and other foreign language practitioners are few and far between in North Korea.

Seoul based Bithumb, the world’s largest exchange for Ethereum, said in June that it had been a victim of a hack that had stolen customer information from an employee’s computer. It would stand to reason that this attack was committed by North Korea.

North Korea’s signature hacking strategy is known as spear-phishing, where mass emails are sent to high value targets that contain malware designed to take sensitive information from their targets.

The true scale of North Korea’s hacking capabilities, and how they are being applied to cryptocurrencies is just beginning to be comprehended by intelligence agencies. It is possible at this point that North Korea’s hackers may just be their own version of a central bank, except rather than printing money, they are stealing it.

If North Korea is able to successfully amass a war chest of Bitcoin, it would enable them to have two strategic capabilities. On one hand, they could use the currency to make payments to China and Russia for crude oil and other supplies, with the need for traditional banking institutions. On the other hand, they would possess a financial weapon of mass destruction if they were able to manipulate the price of currencies.

If it turns out to be the case that North Korea has a massive cache of cryptocurrencies, that could allow them to completely nullify any international sanctions, which generally operate by identifying and freezing traditional bank accounts and traceable financial assets.

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Shock! Only 2 People Show Up For iPhone 8 Launch in China

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—Via Zerohedge

Confirming reports that reception for Apple’s newly launched iPhone 8 may be “underwhelming” to put it lightly, as the phone provides little if any material improvement over its lower-priced predecessor even as sales for hardcore fans will be cannibalized by the iPhone X, is the following report from Hangzhou, China which shows that all of 2 people were waiting in line for the latest gizmo from Tim Cook.

 

With the iPhone 8 a dud, at least in China, AAPL longs are hoping that the reception for the iPhone X in a few weeks will be notably more enthusiastic, or else Apple may have a major problem on its hands.

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In an Increasingly “Free” World, Developers Are Turning to Blockchain to Monetize Their Apps

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When the iPhone was invented, and mobile phones were first beginning to move to third-party app based user experiences, it was fairly easy for app developers to make money. The business model was simple: make something useful, charge $.99-$2.99 for it and then market it to a lot of people.

Ten years into the app-based universe, developers are developing increasingly complex monetization schemes to make money. The most popular of which is, at the moment, often-times deceptive in-app-purchase designs.

Across the board, the margins are becoming thinner and thinner for software developers as a race-to-the-bottom takes place in terms of pricing experiences within apps.

In the age of blockchain technology, apps are increasingly looking towards innovative blockchain based overlays in order to monetize user activity within their apps.

The revenue available to software companies that succeed in monetizing their apps in tremendous. Companies like KrossCoin are specializing in building the overlay framework for developers to make money, by introducing a consumption-based token framework that allows application developers to monetize any functional component, in any application, running on any platform.

Consumption based monetization models appear to be the future for the world of mobile apps, which experts believe will be an industry that generates $139 Billion in revenue by 2021.

By monetizing consumption within apps, a better value proposition is struck for both the developer, and the user of the app. Instead of charging users for apps they never, or rarely use, software developers will only make money when they build worth-while apps, and likewise, the revenue that’s created will be paid directly to the creator of the app, rather than to the company that runs the app store.

Experts are beginning to come to the consensus that consumption-based monetization models are the future for software developers. Blockchain is poised to be the ideal framework for the monetization models to be built around.

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Socialism is a Lame Accounting Trick, Not an Economic System

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The far left in the United States often touts Denmark as a role model country, that we should strive to be more like. From free child-care, to free college, to more vacation days, there seems to be no limit to the wonders of socialism that the far left will espouse, in an effort to sell their own agenda.

Americans are naturally resistant to the idea of socialism. After all, common sense would tell us that Marxist ideology is the perfect antithesis of what American constitutional values are all about. To counter this natural resistance, leftists in the United States are forced to point to real world examples of the wonders of Socialism.

Denmark is the favorite example of socialism salesmen today. Socialism can work for a short while, but as historians recognize, it quickly collapses under it’s own weight. This is because people simply lose the will to innovate, work hard and create much of anything, when the incentive structure is capped.

Just a few years ago, the favorite example of socialism that leftists used to sell the idea was Venezuela.

 

 

From Jeremy Corbyn, to Michael Moore, Noam Chomsky and even Barack Obama, the left’s praise of Venezuelan Socialist Dictator Hugo Chavez was almost universal among their ranks.

In 2013, when the price of oil hovered around $100/barrel, Venezuela’s socialist oil-economy succeeded in sustaining itself long enough for the ruling class to make themselves and their cronies extraordinarily wealthy.

Just a few years later, with the price of oil bouncing between $40 and $60/barrel, Venezuela has descended into complete economic and social collapse, and the same leftists that were praising the country are now condemning it.

A supermarket in Caracas on Friday after it was looted. Credit: Meridith Kohut for The New York Times

The left moves from one example to the next when it comes to promoting the idea of socialism. They begin with seemingly popular ideas like ‘Universal Healthcare’, and then use the naivete or poor, bright eyed, susceptible college kids to promote even more drastic government funded luxuries such as ‘Free Childcare’ and ‘Free College’.

Of course, there is no such thing as “Government Funded”. The government doesn’t necessarily fund anything, but rather find ways to take wealth created by the industrious, and redistribute it to those less capable or willing to generate resources for themselves.

The Democrat Party’s solution to this little problem of the government not being able to actually fund anything is to delay the time between which the government begins paying for a social service, and the time at which the taxation takes place to actually fund that social service. In the mean time, debt is used to finance the social service, and this (with interest) balloons the debt on America’s balance sheet.

In Venezuela’s case, Crude Oil, was the collateral upon which this economic slight of hand was pulled off. In most Western Countries, simple unsecured debt is the proffered collateral.

In a country like Denmark, which cannot as easily add the debt component (because of their creditworthiness) to pull off this slight of hand, instead begins implementing crushing taxes on the population immediately. This is why in Denmark, after the 180% tax that’s imposed, a Toyota Camry, which in the United States is considered quite a modest car, costs about $42,000.

There is no free lunch. There is nothing that comes without a cost. Socialism amounts to what is essentially an accounting trick to redistribute and delay the true costs and liabilities of goods and services within an otherwise free market. Today the shining example of the temporary effectiveness of these accounting tricks happens to be the Nordic Counties.

This system will fail in the Nordic Countries in the same way that it has failed Venezuela, and in fact, we are already seeing that collapse beginning to take place. The factor that politicians neglect to consider when they promote socialism for their own short-term political gains, is that corporations and wealthy people are smart. If the economic environment brought about by the government becomes untenable, they will simply use their superior knowledge and resources to game the system, or leave all together.

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