Bitcoin Price Falls: How Crash Robs North Korea’s Nuclear Program of Funds

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Kim Jong-un collapses: how bitcoin crash robs North Korea’s nuclear program of funds

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North Korean ruler Kim Jong-un made a lot of money with his hackers

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Bitcoin and other cryptocurrencies have plummeted in the past few weeks. This is not only a problem for private investors, it is also a problem for the North Korean regime’s weapons programs.

It is with spectacular forays that North Korean hackers have transformed from petty criminals into one of the biggest cyber threats in the world in recent years. The regime has benefited greatly. But now he faces a major financial challenge.

With the collapse of the cryptocurrency market, the spoils of digital robberies have also melted considerably, reports the Reuters news agency, citing South Korean government sources. This is a real problem for dictator Kim Jong-un: cryptocurrency revenues are considered the most important source of funding for his nuclear weapons program.

Prey that shrinks

The losses are immense. Chainalysis, a company specializing in movements in crypto networks, has spent months tracking coins that have been stolen, attributed to North Korean hacks, but have not yet been recycled by special services. These cryptocurrencies alone were originally valued at $ 170 million. After the accident there were only 65 million left. The loot from a single robbery is said to have lost 80-85% of its value alone, instead of over 50 million, now it is said to be worth less than ten million dollars.

The incident hit the Kim Jong-un regime in a delicate phase. Since the beginning of the year, North Korea has massively increased its missile tests. This costs: this year alone, the otherwise financially strapped state has already squandered $ 620 million, according to South Korean government agencies. And this despite the fact that the country largely isolated at an international level is already shaken by Covid and an economic crisis. If hackers were no longer sufficient as a source of revenue for the program, the regime would have to rethink, South Korea argues. And it finds the means from other sources.

Few risks, huge profits

The crypto robberies had brought a steady stream of revenue to the regime in recent years. Long mocked for its isolated position on the internet, the country soon proved to be an advantage. Since the country is largely isolated from the World Wide Web, it doesn’t have to worry too much about counterattacks, save for spectacular exceptions. “For North Korea, it’s a cheap, low-risk but highly profitable criminal business,” a South Korean counterterrorism expert told the New York Times.

After a rather simple start-up phase, North Korean hackers like the Lazarus Group (read more here) have developed increasingly sophisticated methods of bringing digital currencies to the country through blackmail or raids on cryptocurrency exchanges. In some cases they have been hugely successful. The attack on the Ronin blockchain system alone took a $ 615 million worth of currency in March. Today, however, the loot would only be worth $ 230 million in ethereal currency.

North Korea goes on

Cryptocurrencies have plummeted in the past few weeks. While the peak value of the best-known currency, Bitcoin, was just under EUR 60,000 per coin in November, it has continued to decline since then – other currencies have followed the same trend. With two particularly strong crashes in May and June, bitcoin alone lost nearly half its value almost overnight, other currencies were hit even harder and suddenly became worthless. With a value of around 18,000 euros, Bitcoin is currently less than a third of its maximum value.

So far, however, North Korea appears to be moving forward as before. Just a week ago, an American company stole nearly € 100 million worth of coins in an attack on the Harmony Blockchain’s Horizon Bridge service. Experts think they know the pattern of the following money laundering attempts. “It looks a lot like what North Korean hackers are known to do,” Nick Carlsen, a former FBI investigator who now specializes in monitoring cryptocurrencies, told Reuters. If that were true, North Korea would likely have plundered more than $ 1.1 billion since the start of the year – roughly 60% of all cryptocurrency stolen.

Sources:Reuters, New York Times, Chainalysis

Read also:

How Kim Jong Un’s cyber army brings millions to the regime

False flag attack: Google denounces North Korea’s clever hacking campaign

“Hidden Cobra”: the FBI launches an attack on North Korean hackers and is opening new horizons

Bitcoin and iTunes Coupons: Here’s How North Korean Hackers Wash Out Their Loot of Millions

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