Crypto Exchange Hacks Helped North Korea Raise $2 Billion for Weapons Programs: Report

Francisco Memoria

According to a confidential United Nations (U.N.) report North Korean hackers have targeted cryptocurrency exchanges and other financial institutions to raise funds for weapons programs.

The report, seen by Reuters, was created by a panel of experts monitoring U.N. sanctions and alleges the country has been using the funds it manages to illegally raise by hacking to fund programs of weapons of mass destruction.

By targeting cryptocurrency exchanges and other financial institutions, North Korean’s operations are said to have had “total proceeds to date estimated at up to $2 billion.” The report adds that North Korea is launching “increasingly sophisticated attacks to steal funds.”

It adds:

Democratic People’s Republic of Korea cyber actors, many operating under the direction of the Reconnaissance General Bureau, raise money for its WMD (weapons of mass destruction) programmes, with total proceeds to date estimated at up to two billion U.S. dollars.

By attacking cryptocurrency exchanges North Korean hackers are, the experts stated, raising funds “in ways that are harder to trace and subject to less government oversight and regulation” when compared to funds that move through the traditional banking sector.

This report on North Korea follows one published in March that alleged the rogue nation used cryptocurrency exchanges to bypass sanctions by carrying out attacks on them and raise funds.  South Korean intelligence has, since last year, been blaming North Korea for attacks on exchanges.

Various high-profile cryptocurrency exchange hacks have been occurring over the last few years. One of the most notable security breaches was that of CoinCheck, which saw hackers take over $500 million worth of NEM tokens from its wallets.

Leading South Korean crypto exchange Bithumb has notably been hacked two times over the last few months. The first time, in June of 2018, hackers stole $31.5 million worth of various cryptocurrencies, while in the second incident, in March of this year, they stole over 3 million EOS from its hot wallet.