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ETHEREUM : He Gave a Cryptocurrency Talk in North Korea. The U.S. Arrested Him.


New York|He Gave a Cryptocurrency Talk in North Korea. The U.S. Arrested Him.

A self-styled “disruptive technologist” was arrested after speaking at a conference in Pyongyang on using digital currencies to launder money.

He was a former hacker from Alabama who styled himself a “disruptive technologist” and believed that he was using his data-mining expertise as a force for good.

But then, in April, Virgil Griffith traveled to North Korea with a visa he had obtained from a diplomatic mission in New York City, going through China to circumvent an American travel ban. He gave a talk at a conference in Pyongyang about how to use cryptocurrency and blockchain technology to launder money, according to federal investigators.

Now Mr. Griffith, 36, faces federal charges that he violated international sanctions. He was arrested on Thursday as he landed at Los Angeles International Airport.

The charges come after the Trump administration raised concerns over the summer about the national security threat cryptocurrencies pose because of their potential to be used to finance illicit activities.

Cryptocurrencies, like Bitcoin and Ethereum, are electronic currencies that can be digitally traded and are not controlled by any government or central authority.


Mr. Griffith, an American citizen who lives in Singapore and works for the Ethereum Foundation, is accused of conspiring with North Korea since August 2018. He appeared in federal court in Los Angeles last week and will eventually be brought to New York. He faces up to 20 years in prison.

Though the United States government had denied Mr. Griffith permission to go to North Korea, he traveled there anyway in April and spoke at the Pyongyang Blockchain and Cryptocurrency Conference, according to a criminal complaint unsealed on Friday.

During his speech and in discussions afterward, he provided information about how North Korea could use cryptocurrency to “achieve independence from the global banking system,” the complaint said. He also later made plans “to facilitate the exchange” of a digital currency between North and South Korea.

“We cannot allow anyone to evade sanctions, because the consequences of North Korea obtaining funding, technology, and information to further its desire to build nuclear weapons put the world at risk,” said William F. Sweeney Jr., an assistant director-in-charge at the Federal Bureau of Investigation. “It’s even more egregious that a U.S. citizen allegedly chose to aid our adversary.”

A lawyer for Mr. Griffith did not respond to requests for comment on Friday.

In a statement, the Ethereum Foundation said Mr. Griffith acted on his own. “We can confirm that the foundation was not represented in any capacity at the events outlined in the Justice Department’s filing, and that the foundation neither approved nor supported any such travel, which was a personal matter,” the group said.

Hacker magazine, 2600, where Mr. Griffith was a contributing writer, issued a statement on Twitter on Friday saying that his arrest was “an attack on all of us.”

The magazine’s editor, who uses the pen name Emmanuel Goldstein, said on Twitter that what Mr. Griffith had done — explaining the concept of cryptocurrency — was not a crime. In a phone interview on Friday, Mr. Goldstein said he had socialized with Mr. Griffith the night before he met with the F.B.I., and Mr. Griffith had insisted on telling federal authorities “the truth” without a lawyer.

“I kept warning him it was a trap,” Mr. Goldstein wrote on Twitter.

Mr. Goldstein said Mr. Griffith was incapable of doing what federal investigators have accused him of. “He would not help a murderous dictator,” he said. “He’s a typical hacker who loves technology and adventure.”

The United States and the United Nations Security Council have imposed tight sanctions on North Korea to try to force the country to curb its nuclear and ballistic missile programs.

Last year, Washington amended its sanctions to prohibit “a U.S. person, wherever located” from giving technology to North Korea. Prosecutors are charging Mr. Griffith’s presentation at the conference amounted to a transfer of technology.

After the conference, Mr. Griffith encouraged other American technology experts to travel to North Korea and attend a similar conference next year, writing in a Facebook post that North Koreans “have reached out to me to for recommendations of new people to invite to their country.”

According to the criminal complaint, Mr. Griffith told a federal investigator in Manhattan in May that the North Korean mission in New York City had given him a visa.

He also said an official at the conference had urged him to talk about using digital currencies to launder money because “such topics were likely to resonate” with the audience, the complaint said.

Later, Mr. Griffith told investigators that the information he shared with North Korean officials included basic concepts that could be found on the internet, the complaint said.

Federal investigators obtained text messages that Mr. Griffith had sent to a colleague in which he said he needed to send cryptocurrency between North and South Korea, the complaint said. When the person asked if that was a violation of United States sanctions, Mr. Griffith said: “It is.”

Mr. Griffith appeared to have a growing affinity for North Korea, according to posts on his Facebook page, where he wrote that “an uncommonly large proportion of news about it happens to be fake.” He also wrote in another post that North Korea “is peak woke,” adding, “Thank you Socialist Party USA.”

He had announced his intention to renounce his American citizenship and has researched how to purchase citizenship in other countries, prosecutors said.

A self-described ex-hacker, Mr. Griffith earned a doctorate from the California Institute of Technology in computational and neural systems, then went to work in Silicon Valley, where he developed a reputation as a tech-world rebel.

He first gained national attention during his freshman year at the University of Alabama, when he and another student found and exploited security flaws in a program used to administer campus identification cards at many universities and colleges.

Hours before the pair were to present their findings at a conference in Atlanta, the company filed a restraining order and then sued them. The parties settled outside of court.

He also was known for inventing a data-mining tool called WikiScanner that made it possible to see who made edits to a Wikipedia entry. Ostensibly, he created the tool to rid Wikipedia of propaganda and sabotage.

But, he acknowledged in a 2008 interview with The New York Times Magazine that he also aspired “to create minor public-relations disasters for companies and organizations I dislike.”

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