North Korea has reportedly amassed $670 million in fiat and cryptocurrencies by conducting hacking attacks, Asia-focused financial newspaper Nikkei Asian Review reports on Friday, March 8. The publication cites a U.N. Security Council report.
The report, prepared by a panel of experts, was presented to the Security Council’s North Korea sanctions committee ahead of its annual report. According to the documents obtained by Nikkei, the hackers attacked overseas financial institutions from 2015 to 2018 and purportedly used blockchain “to cover their tracks.”
As cited by Nikkei, the report states that the attack were allegedly conducted by a specialized corps within the North Korean military, forming part of country’s government policy. The experts believe that the corps is responsible for hacking Interpark, a South Korean e-commerce site, and luring $2.7 million in exchange for stolen data.
According to Nikkei, the experts came to the conclusion that virtual currencies helped North Korea to circumvent economic sanctions — as they are harder to trace and can be laundered multiple times — and obtain foreign currency. The authors of the report recommended that U.N. member nations share information on possible North Korean attacks with other governments to prevent them in the future.
Nikkei also alleges that blockchain has been previously used by a Hong Kong-based startup, Marine Chain, to circumvent sanctions against North Korea. As the newspaper writes, the company, which traded ships around the world via blockchain, was suspected of supplying cryptocurrencies to the North Korean government and shut down in September 2018.
In 2018 a study revealed that hacker group “Lazarus,” reportedly funded by North Korea, has stolen $571 million from cryptocurrency exchanges since early 2017. Out of fourteen separate exchange breaches analyzed, five have been attributed to “Lazarus,” including the industry record-breaking $532 million NEM hack of Japan’s Coincheck in January, 2018.
Meanwhile, other countries sanctioned by the world community, such as Iran and Venezuela, also have reported seeing cryptocurrencies as an effective way to circumvent financial restrictions. For instance, four Iranian banks reportedly developed a gold-backed cryptocurrency called PayMon, and the country is allegedly negotiating with Switzerland, South Africa, France, the United Kingdom, Russia, Austria, Germany and Bosnia to carry out financial transactions in cryptocurrency.