North Korea Suspected in $530 Million Coincheck Hack

North Korea Suspected in $530 Million Coincheck Hack

Feb 7, 2018

South Korean intelligence officials are investigating the strong possibility that North Korea’s government was behind the recent Coincheck hack, which saw the hackers abscond with a record $530 million.

North Korea Suspected in $530 Million Coincheck Hack

Citing a legislator who attended a meeting with the head of South Korea’s National Intelligence Service (NIS), Bloomberg reports the spy agency is investigating the incident as a potential occurrence of state-sponsored cybercrime.

NIS officials began pursuing this line of inquiry after noting similarities between the tactics employed by the Coincheck hackers and past incidents linked to North Korea’s cyber-attack apparatus.

As Strategic Coin reported, the Coincheck hack was carried out in late January. The attackers took advantage of security vulnerabilities in the Tokyo-based exchange’s system, most notably the fact that the firm stored the vast majority of its funds in “hot wallets” accessible through the Internet rather than in offline “cold storage,” which is much more secure.

The hackers only succeeded in breaching one wallet, which held the company’s NEM tokens (XEM). Nevertheless, they managed to make off with more than 500 million tokens, which were worth a combined $530 million at the time of the theft.

The hack was the largest in history, surpassing even the infamous 2014 hack of former bitcoin exchange Mt. Gox, which was also headquartered in Tokyo.

North Korea Turns to Crypto-Linked Cybercrime to Subvert International Sanctions

Bloomberg’s report said that the NIS had not found definitive proof that North Korea was behind the Coincheck hack, but it would not be unprecedented given the country’s history of using cryptocurrency-related cybercrime to subvert international sanctions and finance its expensive nuclear weapons program.

Computer security professionals have fingered North Korean hackers as the perpetrators between several recent strains of malware that hijack computer hardware to mine Monero, an anonymity-centric cryptocurrency.

Moreover, South Korean intelligence officials have indicated that they believe North Korean actors were behind at least one other cryptocurrency exchange hack — that of Seoul-based Youbit, which declared bankruptcy in December after hackers stole 17 percent of the company’s assets.

Strategic Coin is a leading research and advisory firm for companies planning to integrate blockchain capabilities into their business model via utility token launches. Our customer research reports provide qualitative and quantitative analysis of token use cases and platform value. With the Strategic Coin Advantage network of partners, we offer customized services for the pre-launch, full-launch, and post-launch phases of Token Generation Events (TGEs).

Featured Image from Reuters