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North Korean cryptocurrency laundering machine looted around R$2 billion in 2021

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North Korean hackers launched at least seven attacks on cryptocurrency exchanges in 2021, stealing around $400 million in digital assets, analytics firm Chainalysis revealed in its latest report.

The value of crypto assets stolen by these hackers has increased by 40% in 2021 compared to the previous year. While the report did not name all the victims of these attacks, it did mention Japanese exchange Liquid.com, which lost $91 million to hackers.

Furthermore, the report stated that the attacks primarily targeted investment firms and centralized exchanges. Hackers used various tactics like phishing, code exploits, malware and advanced social engineering to gain access to cryptocurrency exchanges.

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“Once North Korea gained custody of the funds, they began a careful laundering process to cover up and cash out,” Chainalysis said. “The growing variety of stolen cryptocurrencies has necessarily increased the complexity of the Democratic People’s Republic of Korea (DPRK) cryptocurrency laundering operation..”

The cryptocurrency laundering procedure

The cryptocurrency industry data platform showed in a report how the North Korean cryptocurrency laundering machine worked. Hackers often exchange stolen tokens for Ether (ETH) on decentralized exchanges (DEX) and send them to mixers (mixers) to hide your transactional history.

Once again, they exchange Ether for Bitcoin on DEXes and send those Bitcoins to mixers before depositing them to Asian-based cryptocurrency exchanges and then withdrawing them.

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“Over 65% of stolen DPRK funds were laundered through mixers this year, up from 42% in 2020 and 21% in 2019, suggesting that these threat actors have taken a more cautious approach with each passing year,” he added. the report.

Read too: How did North Korea create the perfect dollar?

Additionally, the analytics firm identified $170 million worth of unwashed and stolen cryptocurrencies, ideally in North Korean-controlled wallets. These stolen cryptocurrencies were linked to 49 separate hacks from 2017 to 2021.

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North Korea money laundering according to Chainalysis
Value and number of hacks involving North Korea between 2017 and 2021 – Source: Chainalysis

“Whatever the reason, the length of time the DPRK is willing to hold these funds is illuminating because it suggests a careful plan, not a desperate and rushed one,” added Chainalysis.

Meanwhile, the involvement of state-sponsored North Korean hackers attacking cryptocurrency exchanges was previously pointed out by a United Nations panel. North Korea has been accused of using the stolen profits to fund its nuclear weapons program.. However, North Korea denied these allegations when releasing a statement.

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