UN Report Reveals North Korea Masterminded a Crypto Exchange Hack

The United Nations says that North Korea is behind a crypto exchange hack. The preliminary report suggests that North Korea benefited from the hacks, and used the money to fund its nuclear weapons.

$281 Million Stolen by North Korea

According to Reuters, North Korea carted away about $281 million from an attack on an unnamed crypto exchange. An analyst, Frank van Weert from crypto data company Whale Alert, suspects that the report refers to KuCoin’s attack in September last year. The attack drained KuCoin of nearly $275 million, a figure close to the one in the UN report. This attack was one of the largest in the digital currency world.

The confidential report was written by sanction bodies, not under the United Nations, and was submitted to UN security council members. Strong links between the present North Korean administration and the hackers were mentioned in the report. 

A portion of the report reads “Preliminary analysis, based on the attack vectors and subsequent efforts to launder the illicit proceeds, strongly suggests links to the DPRK.” DPRK stands for the Democratic People’s Republic of Korea, which is still North Korea.

The same blockchain transactions connected to the $275 million hack, were again spotted in a second hack. This second hack happened a month later, and drained the exchange of an additional 23 million dollars. North Korean president, Kim Jong-un, is accused of using the stolen crypto assets to fund his nuclear programs. Crypto assets allow him to bypass normal sanctions he would have to face with fiat.

Money Moved Through DeFi

Numerous experts believe the parties involved were trying to use decentralized exchanges (DEXs) to move the money. Peer-to-peer (P2P) trading, available on several exchanges, were then used to escape normal trading on the DEXs. This way, such a huge sum would not attract the eyes of the exchange’s admin.

This might have been how the funds were moved because according to the UN report, DeFi pool was used.” According to sources familiar with both hacks, the attackers exploited ‘DeFi’ protocols,” the report explains. Both North Korea and Seychelles are yet to comment on the findings by the United Nations.