North Korean leader Kim Jong-un is thought to be backing an elaborate scheme entailing the hacking of crypto exchanges.
The group alleged to be doing the hacking is called APT 38. It’s considered to be a highly-skilled state-sponsored group of bank hackers that managed to steal $1 billion from banks to fund its nuclear weapons program, according to Wired.
CCN alerted readers last year about North Koreans using cryptos to avoid U.S. sanctions. Then, we noted that cryptocurrencies were being preferred by international criminals and for terrorist financing.
Now that the country has reportedly set its sights on crypto exchanges, players are taking notice of how these bad actors are penetrating and threatening the space.
Crypto hacking marks a shift in North Korea's approach to cyberwarfare. Last year it backed a scam cryptocurrency called Marine Chain and is holding its first blockchain conference this year.
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— Matt Burgess (@mattburgess1) April 3, 2019
The Fake Crypto
The North Korean’s devious plans to tap the crypto space for its nuke plans entailed an ICO, of course. A company called Marine Chain was to sell a crypto called via the Vessel Token Offering.
The scheme was part of Kim Jong-un overall plan to avoid the various sanctions that have been slapped on the country, especially by the U.S. Ironically, the sanctions are meant to force the country to do away with its nuclear weapons program.
According to Wired, Marine Chain never started selling the Vessel token. However, it is believed to have had the technology in place to do so. Marine Chain was set up to look legitimate and could have easily fooled unsuspecting people.
The lure was offering investors the chance to make money in the lucrative international shipping industry. Wired states:
By throwing their money into a Vessel Token Offering, an alternative cryptocurrency based on the Ethereum blockchain, investors would be able to own parts of ships and then trade with other buyers. Its slickly produced two-page business plan was designed to capture the imagination of potential buyers. In 2022 the company predicted that five percent of global vessel transactions would take place on its platform.
Can’t Beat Em’ Steal It
The state-sponsored hacking group is believed to have fewer than 20 people. Still, APT 38 is a formidable one.
The group is accused of stealing more than a half a billion dollars, $571 million, from crypto exchanges. Wired pinpoints the theft as occurring between January 2017 and September 2018 at five exchanges in Asia.
The thieves pulled off the jobs by hacking cryptocurrency exchanges and by attacking banks with substandard security protocols, according to Wired. A security source told the publication:
“Cybersecurity is no longer just about stopping criminals or protecting your technology. It is about preventing regimes like North Korea from obtaining the means to wage nuclear war. We need to ask ourselves – when North Korea tests their next missile, is it really okay that they paid for it with bitcoin?”