According to Chainalysis’ latest report, there was an unprecedented surge in cyberattacks by North Korea-affiliated hackers on numerous cryptocurrency platforms in 2023. The data from the time period 2016 to 2023 revealed that North Korea targeted and breached 20 cryptocurrency platforms last year. This marked the highest number of attacks for the country within that time frame.
Touted as the world’s most prolific cyber-thief, these cyberattacks conducted by North Korea-affiliated hackers have resulted in the theft of over $1 billion worth of cryptocurrency assets in the past year alone, a figure lower than its record of $1.7 billion stolen in 2022.
It has been alleged that hackers affiliated with North Korea stole cryptocurrency totaling hundreds of millions, to finance their nuclear weapons programs. Since conducting its initial nuclear test in 2006, North Korea has faced multiple United Nations sanctions aimed at restricting the regime’s financial resources necessary for sustaining its nuclear programs.
Chainalysis is the company for blockchain analysis that provide data, software, services, and research to government agencies and largest financial, and cybersecurity companies in over 70 countries
Private US company Chainalysis is a leading company in collecting and analyzing data used on cryptocurrency blockchains. In its annual report on cryptocurrency-related crime, they point out that illicit cryptocurrency volumes reach all-time highs amid a surge in sanctions and hacking.
‘Overall, the share of all cryptocurrency activity associated with illicit activity has risen for the first time since 2019, from 0.12% in 2021 to 0.24% in 2022.’ The company assesses that an equivalent of $20.6B is used for illicit activities.
A big part of that sum comes from the offenses related to the economic sanctions on Russia. This shows that a strict regime of sanctions is efficiently imposed on cryptocurrency exchanges, by the US department of the treasury, and international financial institutions. The report describes methods that are used for money laundering and fund transfers. As a key takeaway, Chainalisys points out that the impact of crypto sanctions depends on the jurisdiction and technical constraints.
Ransomware crypto payments
The report shows a decline in ransomware from 2021. Chainalisys claims that ransomware victims increasingly refuse to pay the ransom money hence pushing the criminals out of this scheme. The report is stating that “meaningful disruptions against ransomware actor groups are driving lower than expected successful extortion attempts” In 2021, the US Office of Foreign Assets Control (OFAC) issued an advisory document about the risk of ‘sanction crimes’ that can rise from ransomware payments. OFAC advises all US companies to report ransomware to the FBI prior to any action. This is also considered to be one of the factors for the drop in ransomware payments. In addition, ransomware lifespan is significantly shorter. From 470 days in 2019, it is down to 70 days in 2022.
Money laundering
The report is stating a rise in money laundering activities from $14.2B in 2021 to $23.8B in 2022. The report is stating ‘underground money laundering services’ are a growing concern. Such groups use private channels on messaging apps to set and organise private transactions that are hard to track.
Cryptocurrency scams
Cryptocurrency scams and the use of cryptocurrency on darknet markets are on the decline compared to previous years.
