Tensions between the US and North Korea soared over the weekend after Washington officially blamed Pyongyang for the cyber attack on entertainment giant Sony Pictures on Friday, the day after a UN resolution on its woeful human rights record was adopted.
Warning of "grave consequences" for what it calls groundless accusations, the North proposed a joint inquiry into the Nov. 24 hacking incident on Saturday. The US, in turn, dismissed the proposal, saying it stood by the Federal Bureau of Investigation's conclusion that the North was behind the hacking.
"The government of North Korea has a long history of denying responsibility for destructive and provocative actions," White House National Security Council spokesperson Mark Stroh said in a press statement. "If the North Korean government wants to help, they can admit their culpability and compensate Sony for the damages this attack caused."
On Friday, President Barack Obama pledged to respond "proportionally" to the North's alleged attack on Sony that forced the firm to cancel the Christmas release of "The Interview," a comedy about two journalists on a mission to assassinate the North's leader Kim Jong-un.
"We will respond. We will respond proportionally and we will respond in a place and time and manner that we choose," Obama said during his year-end press conference.
"We cannot have a society in which some dictator someplace can start imposing censorship here in the US If somebody is able to intimidate folks out of releasing a satirical movie, imagine what they start doing when they see a documentary they don't like, or news reports they don't like."
He did not specify what the "proportional response" would be. But one option could be relisting the North as part of state sponsors of terrorism, analysts said.
Asked whether Washington is considering putting the North back on the terrorism sponsor list, US State Department spokesperson Jen Psaki said that the US has "the right to use all necessary means."
"As the president outlined in his press conference, we, of course, reserve the right to use all necessary means ― diplomatic, informational, military and economic as appropriate and as consistent with domestic and international law ― in order to protect and defend our nation, our allies and our interests," she said during a press briefing.
In 2008, the Bush administration removed the North from the terrorism list in a move to spur international efforts to denuclearize the country. Pyongyang was put on the list in 1988 after a North Korean spy bombed a South Korean passenger plane in November 1987, killing 115 people.
US President Barack Obama listens to a question during a news conference at the White House. (Bloomberg)
The listing would impose economic sanctions on the North. Given the level of the North's isolation, it would not have much of an impact on the already debilitated North Korean economy. But it would further damage its national image and ties with the outside world, observers said.
On Friday, the FBI, the US investigation authorities, announced that it has "enough information" to conclude that the North is responsible for the November cyberattack on Sony Pictures Entertainment.
"We are deeply concerned about the destructive nature of this attack on a private sector entity and the ordinary citizens who worked there. Further, North Korea's attack on SPE reaffirms that cyberthreats pose one of the gravest national security dangers to the US," it said in a statement.
"North Korea's actions were intended to inflict significant harm on a US business and suppress the right of American citizens to express themselves. Such acts of intimidation fall outside the bounds of acceptable state behaviour."
Explaining the North's culpability, the FBI stated that its technical analysis of the data deletion malware used in the attack revealed links to other malware that the North had previously developed. It also found "significant overlap" between the infrastructure used in the attack and other malicious cyberactivity the US previously linked directly to the North.