South Korea’s Snub Snub Bitcoin Reserve, where North Korea accumulates BTC through cybercrime

South Korea and North Korea took a sharp contrasting position on Bitcoin as it reportedly ruled out BTC as part of its foreign exchange reserves.

Why did Korea reject the BTC?

The Bank of Korea (BOK) said Bitcoin did not meet the International Monetary Fund (IMF) standards for reserve assets that emphasize liquidity, stability and credit risk management, according to the report.

Additionally, authorities have highlighted the need for a cautious approach and highlighted Bitcoin price fluctuations as an important drawback.

This is the first time that South Korea’s central bank has explicitly addressed the role of Bitcoin in national reserves. That decision coincides with traditional financial institutions’ cautious attitudes about cryptocurrency, even as global debate on digital assets continues to evolve.

Meanwhile, South Korea’s rejection of Bitcoin as a reserve asset is in contrast to recent US moves.

President Donald Trump’s executive order to establish a strategic Bitcoin reserve has strengthened discussions about the role of digital currency in national financial strategies.

North Korea accumulates bitcoin

South Korea remains wary of Bitcoin, but North Korea has become one of the largest holders of assets backed by the largest state.

The country’s BTC reserve exceeds the reserves of Bhutan and El Salvador, two countries that have actively incorporated Bitcoin into their financial strategy.

Data from Bitcoin’s Treasury Ministry shows that North Korea holds 13,518 btc, worth around $1.13 billion. This brings the holdings above 10,635 BTC in Bhutan and 6,118 BTC in El Salvador.

Unlike these countries that acquired BTC through mining and official purchases, North Korea’s accumulation is linked to the Lazarus Group’s cybercriminal activities and is used to fund the country’s arms programme.

The Lazarus Group, a state-backed hacking organization, played a key role in this construction. This syndicate is linked to several well-known crypto exchange violations, including attacks on DMM Bitcoin and Bibit.

These cyber operations allowed North Korea to accumulate important BTC reserves despite international sanctions and economic restrictions.