Reuters reported on Wednesday, June 29, that four digital investigators claimed that the plunge in crypto markets had destroyed millions of dollars in assets allegedly robbed by North Korean hackers, endangering a crucial stream of income for the sanctioned nation's weapons projects.
A woman walks past a television screen showing a news broadcast with file footage of a North Korean missile test, at a railway station in Seoul on January 20, 2022, after North Korea hinted it could resume nuclear and long-range weapons tests, as it prepared for "long-term confrontation" with the United States, following a string of sanction-busting missile launches this month. (
The U.S. Treasury claimed that North Korea has been investing in cryptocurrency heists in the past few years, rendering a significant hacking danger responsible for one of the greatest crypto thefts ever reported in March.
The Treasury said about $615 million was stolen from the crypto heist.
Crypto Heist
According to two South Korean government sources that talked to Reuters, North Korea's alleged stolen funds are compromised by the sudden drop in cryptocurrency values, which began in May due to a larger economic downturn.
The sources requested anonymity from Reuters and said that crypto's slowdown could have an impact on North Korea's weapons projects.
It happens at a time when North Korea is preparing to resume nuclear testing while conducting a huge number of missile launches that, according to Seoul's Korea Institute for Defense Analyses, have cost more than $620 million this year.
According to New York-based blockchain analytics startup Chainalysis, the value of unlaundered North Korean crypto holdings, which according to Reuters had money robbed in 49 hacks from 2017 to 2021, has dropped from $170 million to $65 million.
TRM Labs' analyst Nick Carlsen also told Reuters that North Korea's crypto heist from 2021 had cost tens of millions of dollars. The alleged stolen funds have dropped from 80 to 85 percent in the past few weeks, decreasing the value to less than $10 million.
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North Korea Denies the Alleged Heists
However, a representative from North Korea who claimed himself to be an embassy diplomat denied the allegations to Reuters, saying that these alleged crypto hacks are false news.
U.S. authorities claimed that a North Korean hacker group known as the Lazarus Group was responsible for the $615 million cyberattacks on Ronin's blockchain project, which runs the online game Axie Infinity.
Reuters further noted that Eric Penton-Voak, the coordinator of the United Nations group of experts that supervises sanctions, stated at a gathering in Washington, D.C., in April that cyberattacks have become significant to Pyongyang's capacity to dodge sanctions and generate revenues for its nuclear and missile operations.
According to sanctions observers, the North Korean government used hackers to raise an estimated $2 billion in 2019.
North Korea is believed to spend roughly $640 million annually on its nuclear weapons, according to a report by the Geneva-based International Campaign to Abolish Nuclear Weapons. The central bank of South Korea also predicted that the nation's GDP would be about $27.4 billion in 2020.
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Written by Joaquin Victor Tacla
