Russian Crypto Exchange Used by North Korean Hackers

Russian Crypto Exchange Used by North Korean Hackers

North Korean Hackers Use Russian Cryptocurrency Exchanges to Launder Stolen Funds

A recent study by Chainalysis has revealed evidence of North Korean hackers using cryptocurrency exchanges based in Russia to launder stolen funds. Up to now, these hackers have identified $340 Million in digital currency from North Korean hacks. Nonetheless, it’s critical to consider the geopolitical context surrounding these events.

The Geopolitical Context

Chainalysis is an American company that frequently works with the FBI and IRS, making their actions potentially biased due to their close contact with United States Government authorities. In addition, Russia and North Korea are allies and have a common alliance with China. As the United States considers China and Russia as enemies, it’s critical to note that Chainalysis may not be impartial regardless of their objective data analysis.

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Nevertheless, North Korea has a group of state hackers dedicated to stealing cryptocurrency funds worldwide. They are allegedly using sophisticated cyber attacks to fund nuclear missile programs, according to a United Nations report.

Chainalysis Analysis: Russian Cryptocurrency Exchanges Exploited by North Korean Hackers

Chainalysis’ report suggests a collaboration between North Korean and Russian forces supporting North Korea’s extensive state cryptocurrency hacking campaign. The study outlines that DPRK-linked hacker groups are increasingly using Russian-based cryptocurrency exchanges for laundering stolen cryptocurrencies.

In one case, Chainalysis identified $21.9 Million in stolen digital currencies from Harmony Protocol that were transferred to a Russian exchange. Nonetheless, the exchange did not block these funds as expected. This is not an isolated incident, as Chainalysis found traces of other instances dating back to 2021 where North Korean hackers used Russian exchanges.

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The report suggests a potent alliance between North Korean and Russian cybercriminal actors, reducing the chances of asset recovery due to Russia’s non-compliance with law enforcement agencies.

Increase in North Korean Hacks

In 2023 alone, hacking activities associated with DPRK yielded $340.4 Million, while the total amount stolen a year ago had more than $1.65 billion. This surge in 2022 accounted for almost half of all funds stolen since 2016. Chainalysis reports that 29.7% of digital currencies stolen through hacks this year can be attributed to North Korean state hackers, indicating an increase from the previous year.

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The hypothesis is that North Korea uses these attacks to finance its nuclear missile program, with Russia either cooperating or turning a blind eye to take advantage of the stolen funds. Although while other states attempt to identify and block hackers, North Korea has even hired them in particular  for stealing digital currency. Russia falls between the collaborationist states that support this illicit behavior by failing to cooperate with international law enforcement agencies.

Hot Take: Collaboration Between North Korea and Russia Fuels Cryptocurrency Hacks

The recent findings by Chainalysis reveal a troubling trend of North Korean hackers exploiting Russian cryptocurrency exchanges to launder stolen funds. This collaboration between two geopolitical allies raises concerns about the role of Russia in supporting illicit cyber activities. With $340 Million identified from North Korean hacks, it’s clear that these cyber attacks pose a whole lot of threat to the security and stability of the cryptocurrency industry.

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Leo Nomist emerges as a maestro harmonizing the roles of crypto analyst, tenacious researcher, and editorial virtuoso, creating an unparalleled symphony of insight. Amidst the intricate world of digital currencies, Leo’s perspectives resonate like finely tuned chords, capturing the attention of curious minds from diverse horizons. His talent for deciphering complex threads of crypto intricacies blends seamlessly with his editorial finesse, translating intricacy into a captivating composition of understanding.

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