North Korea Cyberattacks Account for 50% Foreign Currency Earnings, $3B Stolen in Crypto

The United Nations (UN) Security Council has released a report showing North Korea earns 50% of its foreign exchange earnings from cyberattacks.

The council is also investigating involvement in cyberattacks associated with cryptocurrency companies, which reportedly caused losses of approximately $3 billion (450 billion yen).

North Korea’s Cyberattacks Target Cryptocurrency

North Korea primarily conducts cyberattacks by compromising digital wallet private keys and seed phrases, which are crucial for wallet security. These breaches result in the transfer of victims’ assets to North Korean-controlled wallets, often exchanged for USDT or Tron, which are then converted to fiat currency through large-volume OTC brokers.

Hackers associated with North Korea stole at least $600 million in cryptocurrency in 2023. If confirmed to be North Korean, further hacks in the final days of the year could increase this total to around $700 million. Despite a 30% reduction from the $850 million haul in 2022, the Democratic People’s Republic of Korea (DPRK) accounted for almost a third of all funds stolen in crypto attacks last year.

Attacks attributed to the DPRK were, on average, ten times as damaging as those not linked to the country. Since 2017, Pyongyang-linked threat actors have caused nearly $3 billion in cryptocurrency losses.

Hackers Allegedly Funding Nuclear Programs

Hackers linked to North Korea have been alleged to be using the stolen cryptocurrency to fund their nuclear weapons programs. Facing United Nations sanctions since its initial nuclear test in 2006, North Korea’s financial resources for its nuclear efforts have been targeted.

In its report, the UN Panel of Experts mentioned that it will review sanctions enforcement against North Korea from July 2023 to January 2024, focusing on evasion tactics. The findings will help the Security Council consider new sanctions against violators.

The report highlights that cyberattacks fund about 40% of North Korea’s weapons of mass destruction development costs. There has been a noted uptick in cyberattacks targeting defense-oriented firms, with entities linked to North Korea’s Reconnaissance General Directorate increasingly pooling resources and cyber tools.

The panel’s investigations also explored the possibility of Hamas using weaponry of North Korean origin, a claim supported by Israel, which asserts that Hamas has dozens of North Korean missiles and anti-tank arms. North Korea, however, refutes these claims, dismissing them as baseless.

Despite sanctions aiming to curb North Korea’s nuclear program by limiting funds and banning trade, North Korea continues to import banned petroleum products and export luxury goods, with trade volumes in 2023 exceeding those of 2022, indicating persistent sanctions evasion.