After a year in which he ordered a string of missile launches - including three intercontinental ballistic missiles - and the regime's sixth and most powerful nuclear test, Kim used his annual New Year's Day address to declare the North's nuclear weapons capability a reality.
Analysts say Kim may be trying to drive a wedge between Seoul and its ally Washington as a way to ease worldwide isolation and sanctions against North Korea. Relations between the Koreas have plunged as North Korea has expanded its weapons programs amid a hard-line stance by Moon's conservative predecessors. The tests were the focus of fiery verbal exchanges between the North and U.S. President Donald Trump, who has derisively called Kim, "little rocket man". But U.S. -based experts saw Kim's speech as a clear attempt to divide Seoul from its main ally, Washington, which has led an worldwide campaign to pressure North Korea through sanctions to give up weapons programs aimed at developing nuclear missiles capable of hitting the United States.
The main venues for the Games are just 80 kilometres (50 miles) from the heavily fortified border with North Korea and the build-up to the event has been overshadowed by the nuclear weapons standoff.
Kim also reportedly highlighted the isolated state's economic achievements during the speech, and nodded towards trying to improve the country's standard of living.
With tensions between Washington and Pyongyang over North Korea's missile and nuclear programs showing no signs of ceasing, this statement is most likely to add fuel to the fire.
"The US should know that the button for nuclear weapons is on my desk".
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Moon's ruling Democratic Party also hailed the DPRK leader's New Year address, stressing the importance for inter-Korean dialogue.
An official from South Korea's Foreign Ministry said the 5,100-ton KOTI and its crew members were being held at Pyeongtaek-Dangjin port on the country's west coast amid an inspection over supposed "North Korea-related" activity.
'The Winter Olympic games that will be held soon in the South will be a good opportunity to display the status of the Korean nation and we sincerely wish that the event will be held with good results, ' he said.
Referring to the Olympics, he said later: "We're willing to take necessary steps including sending our delegation, and for this, the authorities from the North and South could urgently meet".
Choi met North Korea's sports official Mun Woong in China on December 18 on the sidelines of a global youth football tournament where North and South Korea soccer teams competed, the Dong-A Ilbo newspaper reported.
The tyrant warned America that it can "never start a war against me and our country" and insisted his nukes are now a reality, not a threat.