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Cryptocurrency

Crypto exchange hacks come from North Korea

Maya Mandz | Mar. 12, 2019
Crypto exchange hacks come from North Korea

March 12, 2019, | AtoZ Markets - According to an Asian news platform, a group of experts told the UN Security Council that North Korea has been the driving force of crypto hack incidents since 2016. What actions the US Security Council will take against the North Korean authorities?

The UN report on North Korean hackers in brief

As the group of experts claims, the country used its illegally obtained $ 670 millions to “avoid economic sanctions and get foreign currency." The blame was placed on a specialized military unit of the North Korean government. The experts suggest that this unit also collaborated with the notorious Lazarus group, known for its hacking skills. The report submitted to the U.N. noted that the focus of most attacks was on Asian firms. The report says:

Between January 2017 and September 2018, the Democratic People’s Republic of Korea successfully hacked cryptocurrency exchanges in Asia at least five times, with losses totaling $571 million, the panel estimated. The attacks are understood to have been carried out by a specialized military unit and are now a crucial part of North Korean government policy.”

The document was concluded with the following: “Cryptocurrencies provide the Democratic People’s Republic of Korea with more ways to avoid sanctions since they are harder to track, can be laundered many times and are independent of government regulation.

UN member states are encouraged to be cautious on cybersecurity

The group of experts recommended that the UN member states “expand their ability to promote the active exchange of information on cyber attacks by North Korea with other governments and with their own financial institutions in order to detect and prevent the invasion of sanctions by this country.

Korean Democratic People’s Republic searching for the ways to overcome the US sanctions

North Korea following Venezuela and Iran examples, continues to search for ways to overcome the effects of the economic sanctions imposed on its nuclear and missile programs. The country's coal export trade has been reduced, so cryptos and hacking, apparently, served as a kind of safety plan.

Loses due to North Korean hackers are enormous

The latest cybersecurity reports showed that nearly $ 2 billion was lost in 2018 due to the security breaches of crypto exchanges and fraud with ICOs.

Several companies such as Chainalysis, CipherTrace, and Group-IB analyzed the blockchain transaction history and collected open data to determine the nature and amount of total losses. The findings of the aforementioned organizations confirm fears about the behavior of countries that have fallen under US sanctions.

Although the anonymity of the blockchain prevents the disclosure of address holders, the study indicates a repetition of the models and personalities of professional hacker teams.

Most cyber attack traces lead to North Korea

Group-IB was able to find enough evidence that North Korean-based hacker group Lazarus "was responsible for some of the most devastating crypto industry hacks in the past 12 months

The group is directly connected with attacks on the following five cryptocurrency platforms - CoinCheck, YouBit, Coinis, Bithumb, and Yapizon.” The hack of the Japanese exchange Coincheck in January 2018 resulted in the disappearance of 530 million dollars in the NEM cryptocurrency. A group of hackers was then not seen in any subsequent attacks.

The major targets for many of these attacks were crypto exchanges in South Korea. The South Korean National Intelligence Service (NIS) has already determined by February 2018 that North Korea is responsible for stealing millions of dollars from South Korean stock exchanges. As evidence continues to accumulate from other sources, it remains to be seen whether the US Security Council will take swift action against the North Korean authorities.

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Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.