North Korea’s “Cryptocurrency-1”
Cryptocurrency developer Virgil F. was arrested a few days ago at Los Angeles International Airport. Arresting travelers at the airport right before they leave appears to be a thing for the FBI, e.g. a OneCoin founder was arrested at the same airport on his way out, and Malware Tech was arrested at Vegas airport after a conference. Is it the free coffee for law enforcement?
He traveled to North Korea, gave a talk there entitled “Blockchain and Peace” and then allegedly tried to organize a symbolic 1 ETH payment to South Korea ($216 at the time). Here’s the full inditement: https://www.justice.gov/usao-sdny/press-release/file/1222646/download
There’s serious concern that although the case may have some merit, the real goal of the FBI is set a dangerous precedent about a specific aspect of this case: providing education about publicly available information.

(update: Peter Todd points out his description “doesn’t appear to be completely correct. The FBI did mysteriously cut off one of their options to getting the data off the phone. But it seems that was in changing the iCloud password, disabling unencrypted backups, not the pin.”)
So it’s important to critically analyse this case. This means keeping an eye out on new information being released, as the inditment only contains information needed to show Probable Cause:

- Traveling to North Korea after being explicitly denied permission
- Providing any kind of service to North Korea without permission (banned by Trumps executive order 13722)
- Giving a presentation about “blockchain technology”, emphasising its hypothetical usefulness for sanctions evasion, based solely on publicly known information
- Organizing a symbolic transfer as a proof-of-concept for said evasion
I find (3) and (4) particularly problematic.
Giving a presentation
Regarding (3) one should ask the following question: what if he had given the same presentation on US soil, recorded it on Youtube and tweeted it out with “Hey Kim, check this out, you’ll find this useful when @realDonalTrump racks up sanctions again”? Would this be covered by the First Amendment? If so, does it really matter that he gave the speech while physically in North Korea?


Symbolic transfers
Regarding both (3) and (4), the inditement goes to great lengths to accuse him of actually assisting in transferring funds out of North Korea:

One could also argue that refusing a “suggestion” from a North Korean government official while in North Korea is unwise. Of course he could have dropped the idea later, rather than organise a demo:

I find it a complete stretch to call such a demo, that they could have found on Youtube, a serious effort to evade sanctions. It takes a lot more to really move money. I won’t go into details, partly because I actually don’t know, partly because I don’t want my name on the next inditement. The FBI knows better than to drink the crypto-trivially-beats-government kool-aid.
Morality
There is of course also the moral question of whether one should go to North Korea (or China for that matter) to educate the government on this technology:

