According to researchers, the deepening crypto winter poses a threat to a crucial source of funding for North Korea’s weapons programs. It is not clear how much crypto the North Korean administration has collected over the year, but it is potentially going to be a substantial amount.
A 70% recession in crypto markets since November will have rotted a large piece of that digital stockpile, possibility restricting the rogue state’s ability to carry out more weapons tests or fund cybercrime organizations.
On June 28, two anonymous South Korean government sources articulated that the crypto winter had impacted North Korea’s ability to carry out more heists and hacks on the sector.
North Korea: A History of Crypto Hacking
Some of the biggest crypto hacks over the past couple of years have been attributed to North Korean hacking groups such as Lazarus. Pyongyang has been streaming resources into funding such hacker collectives, but the downfall in the prices of cryptocurrencies may impact its ability to do so.
The group was tied to the largest ever crypto attack in March when more than $600 million was stolen from Axie Infinity’s Ronin bridge. The Korea Institute for Defense Analyses in Seoul evaluates that missile testing has cost North Korea as much as $620 million so far this year.
According to blockchain analytics firm Chainalysis, older crypto wallets regulated by the regime holding funds from hacks between 2017 and 2021 have dropped in value from $170 million to $65 million since the inception of 2022.
Nick Carlsen, an analyst with TRM Labs, stated that one crypto cache from a 2021 hack has lost as much as 85% of its significance over the past few weeks and is currently worth less than $10 million.
Targeting DeFi platforms
As per reports, last week, North Korean-backed hackers had stolen as much as $2 billion in crypto over the period of the past decade. Author of a new book called “The Lazarus Heist,” Geoff White, thinks that the group will keep targeting crypto, especially DeFi (decentralized finance) platforms.
Most of the recent exploits have transpired on bridges that link different blockchain networks allowing token sharing. Just last week, the Harmony network’s Horizon bridge was exploited for $100 million, but the attackers’ identity has yet to be publicized.
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