North Korean hackers are responsible for stealing as much as $395m worth of crypto over the past 12 months, according to a new report by Chainalysis.
The blockchain data company noted that this was a $100m increase compared to 2020, bringing the total tally of stolen crypto that has been linked to North Korean hacker groups to $1.5bn.
Chainalysis acknowledged that there may have been more thefts that it had not been able to register.
One of the main reasons for the sudden spike is the lack of financial alternatives in North Korea. The authoritarian regime of Kim Jong-un has been deprived of international markets and financial aid, prompting its people to get creative.
North Korean hacker groups are believed to work directly for Kim Jong-un’s government and the proceeds from crypto theft are allegedly poured back into the country to fund basic services, weapon development and provide food.
According to Erin Plante, a senior director of investigations at Chainalysis, 2021 may serve as a banner year for the North Korean hackers.
Another reason for hackers becoming more active is the sudden spike in value of cryptocurrencies.
The total value stolen by North Korea was calculated based on the daily exchange rate of each cryptocurrency on the day of the theft. Even then, these thefts are still lower than what was registered in 2018 when North Korean hackers stole a record $522m, and often with help from foreign citizens.
This is doubly impressive when you consider that the rates for crypto back in 2018 were just a fraction of what they are today. However, hackers have changed focus in recent years. They have been notably moving away from Bitcoin and targeted as much as $272m worth of Ethereum cryptocurrencies. DeFi has also been targeted according to a separate report.
“Some of these exchanges and trading platforms are just newer and potentially more vulnerable to these types of intrusions. They're trading heavily in ether and ERC-20 tokens, and they're just easier targets”, Plante explained.
But the attacks have not been entirely out of desperation. North Koreans have seemed very patient before cashing out their money. According to the company, some stolen funds were cashed out only after a decade of stealing them, demonstrating strategy and prescience.