North Korean leader Kim Jong Un inspects an event hosted by North Korea’s special military forces in a photo released via Getty Images on April 14, 2017.STR/AFP
North Korea’s giant crypto hack marks a new era in cybersecurity threats.
“If there was ever any doubt that hacks aren’t related to national security, that’s settled,” a blockchain expert told Insider.
TRM’s Ari Redbord has broken down how the hack means the birth of a new breed of cyberwarfare.
US authorities this week linked North Korean hackers to the historic $625 million Axie Infinity crypto scam, with the massive hack marking the birth of a new breed of national security threat, according to a blockchain expert.
On Thursday, the US Treasury Department added an Ethereum wallet address to its sanctions list after the wallet enabled transfers for more than $86 million of the stolen funds.
Hacking outfits Lazarus and APT38, both linked to North Korea, are behind the theft, the FBI said in a statement, and the funds are generating revenue for Kim Jong Un’s regime.
Ari Redbord, head of legal and government affairs at blockchain research firm TRM, says the attack shows that even a nation as isolated as North Korea can take part in a new-age cyber war.
“In recent years, many hacks have been carried out by North Korea,” Redbord told Insider. “But the scale of this case shows things have moved from small heroic acts to genuine national security concerns. It’s breathtaking – bank robbery at the speed of the internet.”
For years, North Korean actors have been responsible for cyberattacks, including a high-profile attack on Sony in 2014. But groups like Lazarus have become increasingly sophisticated and ambitious.
Meanwhile, companies in the burgeoning crypto sector are still finding their feet when it comes to cybersecurity, leaving them vulnerable to hacker groups that are constantly refining their tactics.
“North Korea realized that hacking an online retailer was one thing, but tracking crypto exchanges is a more effective way to fund destabilizing activities at a very low cost to them,” Redbord said.
The story goes on
The country is an early adopter of cryptocurrency money laundering, he added, and there are no signs its bad actors are slowing down their efforts as it has proven extremely profitable.
Additionally, Redbord noted that social engineering attacks such as the Axie Infinity infiltration are becoming more sophisticated.
These hacks are not the result of simple bulk phishing emails, he explained, but rather nuanced and targeted attacks on specific individuals.
The new digital battlefield
Despite having an extremely small economy and limited infrastructure, North Korea has proven that it can engage in cyber warfare on a similar scale to global superpowers like the US and China.
In particular, the Axie Infinity hack reinforced Redbord’s belief that the scale of digital attacks is increasing so rapidly that a new type of warfare is emerging.
“Over the past year or so, we’ve moved from a post-9/11 world to a new digital battlefield,” said Redbord. “Nation-state actors know they have to go after crypto companies to fund the proliferation of real weapons, it’s not just a few hackers trying to fund a lifestyle.”
North Korea’s deployment of the Lazarus group confirms that the country’s isolated status and lack of modern infrastructure are not preventing it from engaging in cyberwarfare on the world stage, Redbord said.
The cryptocurrency industry is an excellent target for these attacks due to the volume of transactions and funds that are moved on a daily basis, but also because the companies are not yet fully mature and may still be developing their own cyber security protocols.
Unfortunately, that means many organizations often don’t have the most up-to-date security measures in place, Redbord said.
“It is important to strengthen cyber defences. We’re still in a world where these companies are learning to protect themselves, and now we’ve seen that a small group is responsible for crypto’s biggest hack,” he said. “If there was ever any doubt that hacks have nothing to do with national security, that’s settled.”
Read the original article on Business Insider