In order to avoid sanctions and fund Kim Jong Un’s regime, North Korea is trying to steal bitcoin and other virtual currencies, according to a report.
With the suspected aim of stealing the digital tokens, North Korean hackers had targeted at least three South Korean cryptocurrency exchanges, the report, published Monday by cyber security firm FireEye, found.
To obtain virtual cash illicitly, spear phishing – a fraudulent method of sending emails to make them look like they were sent by someone you know, was used by the hackers, according to FireEye.
Previously, accusations of cyber-attacks to target banks have bene previously bene placed on hackers affiliated with the country.
Suspicious activity affecting the exchanges over several months was lodged by FireEye. While not being able to be clearly linked to North Korean involvement, four wallets on the Seoul-based cryptocurrency exchange Yapizon were compromised in April. A spear phishing attack that successfully compromised an exchange later in May was monitored by the firm.
Bitcoin reached an all-time high of $5,103 earlier this month and has surged in both price and popularity this year.
But following China’s decision to ban initial coin offerings (ICOs), which allow start-ups to raise funds by selling new digital currencies, the asset saw its value dip more than $1,000 within the space of three days and hence it is highly volatile.
After it was widely reported local bitcoin exchanges would be shut down by authorities, the Chinese government took a notably harsher stance on Monday. This saw the price hit a low of $4,108 Monday.
“As bitcoin and other cryptocurrencies have increased in value in the last year, nation states are beginning to take notice,” Luke McNamara, senior cyber threat intelligence analyst at FireEye, wrote in the report.
As they move out of the periphery and into the mainstream, several governments have shown increasing interest in virtual currencies. For instance, securities law could apply to ICOs, indicated the U.S. government. Meanwhile, via a state-backed ICO, Estonia has said it wants to launch its own cryptocurrencies, called “estcoin”.
In an effort to clamp down on money laundering and other illicit activities, legislation which would bring digital currency exchange providers under the remit of its government financial intelligence agency has been proposed by Australia.
“Consequently, it should be no surprise that cryptocurrencies, as an emerging asset class, are becoming a target of interest by a regime that operates in many ways like a criminal enterprise,” McNamara added.
“While at present North Korea is somewhat distinctive in both their willingness to engage in financial crime and their possession of cyber espionage capabilities, the uniqueness of this combination will likely not last long-term as rising cyber powers may see similar potential. Cyber criminals may no longer be the only nefarious actors in this space.”
Following its decision to conduct a missile test over Japan earlier this month, North Korea has faced increasing international trade pressure.
But according to the report, sanctions “could be driving” North Korea’s interest in cryptocurrencies. in exchange for stolen virtual coins in order to fund the regime, the country could be attempting to obtain hard cash, FireEye said.
(Adapted from Reuters)