NEW YORK -- With North Korea facing the toughest-ever set of economic sanctions from the international community, it appears the country may be trying to hack bitcoin and other cryptocurrency exchanges in a bid to obtain much needed funds.
Cybersecurity research companies in the U.S. have reported hacking and mining activity emerging from the reclusive state. Digital, cross-border transactions of cryptocurrency are not subject to the formal banking regulations of any country. If Pyongyang does manage to leverage digital currency transactions to bypass sanctions, it could affect the stance taken by the United Nations in its future dealings with the regime.
Information security business FireEye in September released a report concluding that hackers, likely from North Korea, had attacked at least three South Korean digital currency exchanges between May and July, and succeeded in stealing bitcoin from one of them. Although the report did not specify how many bitcoin units were taken, it stated the perpetrators appear to have deployed malware by sending emails to employees, allowing them to obtain the account information of the exchanges and their customers.
FireEye identified the North Korean group behind the bitcoin attacks as TEMP.Hermit. Considering the country's "tight control of its military and intelligence capabilities, it is likely that this activity was carried out to fund the state or personal coffers of Pyongyang's elite," the report pointed out.
The security specialist company has also linked WannaCry ransomware, which launched huge cyberattacks globally in May, with North Korea. Hackers were reportedly able to withdraw bitcoins worth more than $140,000.
As the country's sources of foreign currency are increasingly cut off by the sanctions, it could be turning to cyberattacks to steal digital currencies as a low-cost means of gaining funds, according to FireEye.
North Korean actors also appear to have started bitcoin mining, a process of adding transaction records to bitcoin's block chain ledger. Successful miners are awarded bitcoin units that can be exchange for conventional currency through digital exchanges. According to a recent report from U.S. research company Recorded Future, mining activity linked to North Korea surged during May through July.