"If the U.S. does not keep its promise made in front of the whole world. and insists on sanctions and pressures on our republic", Kim said on Tuesday, "we may be left with no choice but to consider a new way to safeguard our sovereignty and interests".
While North Korea's denuclearization has stalled since Kim's summit with US President Donald Trump in June, partially due to the US's reluctance to provide sanctions relief to the North, inter-Korean reconciliation is proceeding at a steady pace.
In the speech broadcast on state television, Kim said he is ready to meet Trump at any time to forge an agreement "welcomed by the worldwide community". However, he said the North will be forced to take a different path if the United States "continues to break its promises and misjudges our patience by unilaterally demanding certain things and pushes ahead with sanctions and pressure".
In the speech, which stood in stark contrast to last year's address - which saw him order the mass production of nuclear warheads and ballistic missiles - Kim said himself for the first time that the North had "declared that we would no longer produce, test, use or spread our nuclear arsenal" and urged "corresponding measures" from Washington.
In a recent letter to Moon, Kim wrote that he wants to "meet often" to "resolve together the issue of denuclearizing the Korean Peninsula".
Kim called for South Korea to "completely stop" joint military drills with the United States involving strategic assets, while multilateral negotiations among countries involved in the armistice agreement should be pursued to build a permanent peace regime.
On 1 January 2018 Mr Kim ordered mass production of missiles and bombs and warned the whole United States mainland was "within the range of our nuclear strike and the nuclear button is on my office desk all the time".
Seoul and Washington are in a security alliance and the USA stations 28,500 troops in the South.
Kim called his June summit meeting with Trump "instructive" and said they had shared "constructive opinions" on mutual concerns and "speedy solutions to the tangled issues" they faced. He said there would be faster progress on denuclearisation if the United States took corresponding action.
Mr Kim added: 'If the United States takes honest measures and corresponding action to our leading and pre-emptive efforts, then (US-North Korea) relations will advance at a fast and excellent pace through the process of implementing (such) definite and groundbreaking measures'.
Kim also said he is willing to reopen the now shuttered inter-Korean industrial park in the North's border city of Kaesong and resume a suspended tour program to Mount Kumgang on the North's east coast "without any preconditions".
Kim Jong-un making his New Year's address.
Kim's speech also points toward a hard year for the U.S.
That could suggest Kim wants the resumption of the two projects as sanctions relief from the U.S. Neither of those would be possible for South Korea unless sanctions are removed.
The North Korean leader is also indirectly demanding his neighbors to the South push the U.S. and U.N Security Council harder to lift sanctions in exchange for the two countries to resume inter-Korean cooperative projects, Cheong said.
Kim also emphasized the development of the North Korean economy and, without elaborating, mentioned nuclear power as part of the country's plans to boost electricity production.
North Korea for decades has been pushing a concept of denuclearization that bears no resemblance to the American definition, with Pyongyang vowing to pursue nuclear development until the United States removes its troops and the nuclear umbrella defending South Korea and Japan.
Washington and Pyongyang have yet to reschedule a meeting between U.S. Secretary of State Mike Pompeo and senior North Korean officials after the North cancelled it at the last minute in November.