In 2022, thieves stole a staggering $3.8 billion worth of cryptocurrency, a record-breaking amount that was driven by sanctions on North Korea and a surge in suspected hacking by the Asian nation. According to blockchain analysis firm Chainalysis Inc., overall crypto losses increased from $3.3 billion in 2021. Hacking groups linked to the North Korean government are believed to have stolen an estimated $1.7 billion this year, a dramatic increase from the $400 million stolen in 2021.
As international sanctions have tightened, North Korean hackers have turned to the cryptocurrency sector as a means to generate revenue. Fraudsters have employed a variety of tactics, from posing as non-North Koreans in job interviews to deploying ransomware, to acquire funds. US Deputy National Security Advisor for Cyber and Emerging Technology Anne Neuberger has stated that money stolen via hacking makes up roughly one-third of the funding for Pyongyang’s weapons development programs.
The US Federal Bureau of Investigation recently blamed two North Korean cybercrime groups for stealing $100 million in a heist in June 2020 at the Harmony Bridge crypto service. The Lazarus Group, a specialized hacking unit associated with North Korea’s Reconnaissance General Bureau, is also believed to have stolen roughly $600 million in March 2021 from a blockchain network connected to Axie Infinity, a popular video game. Fortunately, investigators were able to recover some $30 million of the stolen funds, marking the first-ever seizure of funds stolen by hackers with links to North Korea.
Chainalysis Inc. concluded that, while North Korean-linked hackers are undoubtedly sophisticated and represent a significant threat to the cryptocurrency ecosystem, law enforcement and national security agencies are making progress in their fight against them.