[Photo by the official website] Ethereum logo.
[Asia Economy Reporter Kim Daehyun] North Korea has intensified cyberattacks targeting the cryptocurrency market and has been using cargo ships instead of oil tankers to import petroleum products in an attempt to evade international sanctions.
According to a report released on the 7th (local time) by the UN Security Council's Panel of Experts on North Korea Sanctions, at the end of March, the Ronin Network, which operates the NFT-based video game 'Axie Infinity,' was hacked by North Korea, resulting in the theft of 173,600 Ethereum and USD Coin (a type of stablecoin) worth approximately 25.5 million dollars.
The total damage from this incident is estimated at 625 million dollars (about 890 billion KRW), making it the largest cryptocurrency hacking case ever recorded. The U.S. Federal Bureau of Investigation (FBI) announced in April that the incident was carried out by 'Lazarus,' linked to North Korea's Reconnaissance General Bureau.
The Panel of Experts emphasized the likelihood of North Korea's involvement, noting that the cyberattack on blockchain technology company Harmony's 'Horizon Bridge' in June used methods very similar to those employed in the Ronin Network hack.
The report stated that Lazarus is also the main suspect in this incident, which is estimated to have stolen 85,800 Ethereum, and that investigations by authorities are ongoing.
Although both companies had no technical vulnerabilities, North Korean hackers reportedly used social engineering hacking techniques, targeting individual weaknesses to extract necessary information and infiltrate systems. The stolen cryptocurrencies were laundered through decentralized finance transactions and 'mixers' (technology that breaks down cryptocurrencies to obscure the sender's identity).
Besides Lazarus, BlueNoroff, an organization under the Reconnaissance General Bureau known for the 2016 Bangladesh Central Bank hacking, has also shifted its attack focus to the virtual asset industry.
Cyberattacks aimed at obtaining 'valuable' information such as WMD development have continued. North Korean hacking groups like Lazarus and KimSuky have conducted spear-phishing attacks and distributed viruses targeting companies and institutions worldwide, including defense contractors.
Sanctions violations at sea, such as illegal imports of petroleum products and illegal exports of North Korean coal, have continued this year as well. Although the officially reported annual import volume of petroleum products by North Korea to the Sanctions Committee was only 8.15% of the 500,000-barrel annual cap, it is highly likely that the actual volume nearly reached or exceeded this limit. One member state estimated that from January to April this year, 16 North Korean oil tankers made 27 deliveries to Nampo, totaling 458,898 barrels, which is 90% of the cap.
While North Korea continues to evade sanctions through ship-to-ship transfers at sea, it has recently been discovered that cargo ships have been converted for smuggling petroleum products instead of oil tankers.
Cases of luxury goods smuggling, which frequently appeared in previous North Korea sanctions reports, have noticeably decreased since the COVID-19 pandemic.
Additionally, the report included a member state's account that North Korea attempted to sell weapons worth 3.5 million dollars to Nigeria.
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