Hacker groups affiliated with North Korea have become highly active in the digital asset space, relentlessly pilfering funds. Despite a decrease from the record-breaking numbers of 2022, the “hermit kingdom” has continued to concentrate on the cryptocurrency landscape this year.
In fact, the stolen funds are being funneled in billions into the country’s nuclear program.
North Korea’s Crypto Heists
According to a report by local media outlet Asia Today, South Korea’s National Intelligence Service, in the first six months of the year alone, North Korea has illegally amassed nearly $180 million in the process.
The infamous hacking entity – the Lazarus group – has been under the radar of several global organizations. It was suspected as the culprit for last year’s $100 million Harmony Bridge hack.
Earlier this year, the United States Department of Treasury sanctioned three China-based OTC traders who helped the notorious group in facilitating the conversion of stolen cryptocurrency to fiat.
More recently, Estonian crypto-payments service provider CoinsPaid also found that the notorious Lazarus spent six months tracking and studying the platform before finally attacking in July. Euler Finance, Atomic Wallet, and Axie have all fallen victim to malicious North Korean entities targeting the digital assets space.
Over the past five years, North Korea has stolen approximately $2 billion in crypto assets, according to yet another report by blockchain intelligence firm, TRM Labs. While targets and techniques employed by the country have evolved, their on-chain laundering methodologies have also greatly improved.
“North Korea’s early exploits – which tend to involve the direct use of cryptocurrency exchanges – now feature highly complex, multi-stage money laundering processes in response to more aggressive OFAC sanctions, law enforcement focus, and improved tracing capabilities.”
North Korea Sanctions Render Ineffective
Throughout 2023, North Korea continued to develop nuclear weaponry and produce nuclear missile material evading United Nations sanctions designed to sever funding for Pyongyang’s nuclear and ballistic missile initiatives.
In the report to a UN Security Council committee, independent sanctions monitors wrote,
“After a record-breaking level of cyber thefts in 2022, estimated at $1.7 billion, DPRK (North Korean) hackers reportedly continued to successfully target cyber cryptocurrency and other financial exchanges globally.”
It is important to note that North Korea has faced increasingly stringent measures since being under UN sanctions for its nuclear and ballistic missile programs in 2006. However, China and Russia advocating to ease these measures in a bid to encourage Pyongyang’s participation in denuclearization talks have created a “deadlock” within the 15-member body.
The U.N. sanctions monitors said hackers working for North Korea’s Reconnaissance General Bureau (RGB), its primary foreign intelligence agency, “continued to use increasingly sophisticated cyber techniques to steal funds and information.”
According to UN sanctions monitors, hackers associated with North Korea’s Reconnaissance General Bureau (RGB), its primary foreign intelligence agency, continues to employ sophisticated cyber methods to steal funds and gather information.