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North Korea Denies Involvement in Massive Crypto Hacks

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If you were to search up a satellite image of North Korea, you would find darkness. Unlike the nation just south of the border, North Korea is barren of lights, being subject to power outages caused by sanctions, resource mismanagement, and so on and so forth.

Despite this, the hermit kingdom has been accused of hosting a budding population of cyber-criminals, cybercriminals that some say have managed to execute some of the most high-profile crypto industry hacks to date.

North Korea Crypto

But, of course, North Korea has been quick to deny that it is participating in or supporting illicit activity.

North Korea Media Denies Involvement in Cyber-Crime

Earlier this month, Reuters came out with a jaw-dropping tidbit on North Korea. Citing a leaked report from the United Nations, the outlet claimed that the nation, which has almost been entirely economically cordoned off from the rest of the globe, has made some $2 billion by stealing capital from banks and cryptocurrency exchanges. An excerpt from the report reads:

“[North Korea] used cyberspace to launch increasingly sophisticated attacks to steal funds from financial institutions and cryptocurrency exchanges to generate income.”

This somewhat corroborates a report from Group-IB, a world-renowned cybersecurity unit. In an article released late last year, the group gave The Next Web data that claimed that the Lazarus Group, a consortium of state-sponsored North Korean hackers, was responsible for at least $571 million worth of crypto hacks — including the $500 million theft of NEM from Japan’s CoinCheck and the $32 million loss that Korean cryptocurrency giant Bithumb incurred in a June 2018 hack.

The U.N. document purported that North Korean authorities have been using the proceeds of the “widespread and increasingly sophisticated” hacks to fund its weapon of mass destruction programs, which have recently been taken up a notch when the nation launched two short-range ballistic missiles in a “test”.

Despite the assertions of a world-renowned cyberanalytics firm and a transnational authority, North Korea isn’t bending.

On September 1st, a spokesperson of the National Coordination Committee of the DPRK for Anti-Money Laundering and Countering the Financing of Terrorism told North Korea’s state-run outlet, KCNA, that the report is “ill-hearted” and that “the United States and hostile forces” are complicit in spreading such “rumors”. It was added:

“Such a fabrication by the hostile forces is nothing but a sort of a nasty game aimed at tarnishing the image of our Republic and finding justification for sanctions and pressure campaign against the DPRK.”

Still Oft-Cited Crypto Concern

While North Korea may be denying all accusations of participating in cryptocurrency hacks, officials of the U.N. have still cited the nation as a way to discredit digital assets. As reported by Blockonomi, Neil Walsh, the head of cybercrime enforcement and anti-money laundering at the U.N.’s Office on Drugs and Crime, said that due to the pseudonymous, global, uncensorable, and digital nature of most cryptocurrencies, crime is made vastly easier.

Walsh claimed that these technologies hamper the fights against cybercriminals, terrorist financing, and money laundering is being hampered by the propagation of cryptocurrencies.

Also, he mentioned North Korea, citing the report to accentuate that in the eyes of the U.N., cryptocurrencies aren’t conducive to the safety of the world in their current form, and thus require regulation.

The official asserted that this industry needs to be addressed with a multi-faceted approach that needs the “whole nine yards” of brains — “technologists, policymakers, philosophers, and so on.”

One solution he brought up is to regulated all fiat onramps and offramps, which he says will help ensure that the world’s “most vulnerable” are better protected.


I am a writer who has been following the cryptocurrency space since 2013. My insights and interviews have been featured in leading publications in the industry such as LongHash, NewsBTC, and Decrypt. When I am not writing, I work as a team member of the EXODUS division of HTC, a Taiwanese electronics company. I own a small amount of Bitcoin. Contact NickC@blockonomi.com

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