- North Korea has laundered $170 million in stolen cryptocurrency from 49 hacks (2017-2021).
- Laundered funds are used to support North Korea’s nuclear and missile programs.
- Cyberattacks generate about 50% of North Korea’s foreign currency income.
The latest $1.5 billion hack of crypto exchange Bybit has once again put the spotlight on North Korea’s cybercrime activities.
Reports have consistently revealed the stolen digital assets are funneled into the country’s weapons programs with the Lazarus Group being held responsible for stealing millions of dollars in digital assets over the years.
$170 Million in “Unused” Crypto Stolen Since 2017
Between 2017 and 2021, North Korea collected $170 million in unused cryptocurrency from 49 hacking incidents. Interestingly, the largest portion, approximately $60 million, arose from a single attack, referred to as “Hack A.”
Smaller sums, ranging from $5 million to $15 million each, were acquired through additional hacks. Even more surprisingly, some funds from attacks as early as 2016 remain unlaundered and untouched, totaling over $55 million.
Related: North Korean Cybercrime: Lazarus Group Launders Millions Through Cambodian Firm
Inside the Crypto Laundering Process
The laundering process begins with swapping ERC20 tokens, like stETH, into Ethereum. Next, ETH is converted into Bitcoin.
Once the funds are in Bitcoin, they are sent through mixers. Mixers are used to help cover up their origin. After mixing, the consolidated BTC is moved to wallets controlled by North Korea.
Final Step: Cashing Out Bitcoin via Asian Exchanges
The very last step involves using centralized services in Asia. Here, they cash out Bitcoin into fiat currencies, mainly the Chinese Renminbi. This entire system enables the attackers to access the funds in liquid form.
Critically, it also makes it difficult for authorities to trace the stolen assets back to their origin.
Perhaps the biggest threat with these activities is the direct connection between cyber theft and the funding of North Korea’s nuclear and missile programs. Reportedly, between 2017 and 2023, North Korea’s cyberattacks raised about $3 billion in stolen cryptocurrency.
Cybercrime: Nearly Half of N. Korea’s Weapons Funding
Disturbingly, according to a United Nations report, these funds account for about 40% of the country’s weapons of mass destruction programs.
Related: ZachXBT Uncovers New Evidence in $305 Million DMM Bitcoin Hack Investigation
Beyond weapons, the money from these cyberattacks has also become a source of foreign currency income. By some estimates, cybercrime amounts to around 50% of North Korea’s foreign revenue.
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