A United Nations Security Council panel has called for member states to share information regarding hacking and crypto-currency theft originating in North Korea.
In its annual report, the panel told the Security Council’s North Korea sanctions committee that the rogue nation had amassed more than US$670 million in crypto and foreign currencies via cybercrime and hacking. According to the Nikkei Asian Review, it was the first time the panel had provided details on how Pyongyang acquired illicit funds.
The UN experts advised members to enhance their ability to exchange information on North Korean cyber-attacks. The report claimed that North Korea had been actively waging war online against foreign financial institutions for the past four years. It was believed that the attacks had been orchestrated by a specialized division of the North Korean military backed by the Kim Jong Un regime.
The UN reports said South Korea had been one of the primary targets, with an estimated 10 million users compromised in one attack on an e-commerce site in the country. Here, ransomware was reportedly the weapon of choice as the hackers demanded $2.7 million in total for returning the stolen data.
The panel estimated that Pyongyang had launched successful cyber-attacks on Asian crypto exchanges at least five times since January 2017. Loot gained from the incursions was estimated at more than $570 million. In 2018, a study revealed that a hacker group called ‘Lazarus’ funded by the North had been behind the crypto exchange heists.
The most infamous of which was the hack of Japan’s Coincheck exchange in January 2018 which resulted in the loss of more than $530 million in NEM tokens. Many industry observers had attributed this event as the catalyst for the year-long crypto bear market that followed.
The report also accused one Hong Kong-based blockchain startup of supplying the North with crypto-currencies. Marine Chain, which used blockchain to buy and sell ships, was shut down in September last year. Chinese messaging app WeChat has, according to the report, also been used to facilitate trade and smuggling with North Korea.
As previously reported in Asia Times, the accumulation of crypto-currencies has helped North Korea evade economic sanctions. Digital currencies are more difficult to trace and can be laundered through several channels to obtain fiat currencies and North Korea is not the only country turning to crypto assets to circumvent economic sanctions.
Russia, Iran and Venezuela are also investing heavily into crypto projects and have launched or planned to launch their own tokens. However, if the recent Security Council report is correct, Pyongyang is in a league of its own and is repeatedly choosing theft over innovation.