North Korea’s crypto-attacks show vulnerabilities in Western security: experts
North Korea’s relentless cryptocurrency theft operations have exposed vulnerabilities in the US security ecosystem, raising security questions in the face of more effective cyber threats from Russia and China.
“They’ve gone into US government websites,” Bruce Klingner, senior Northeast Asia researcher at the Heritage Foundation, told Fox News Digital. “They have entered the financial systems, companies, systems, [and] they were even going after COVID vaccine companies like Pfizer and others to try and get information about the vaccine.”
“It really is an incredibly extensive and capable system,” he added.
Some estimates indicate that Pyongyang stole approximately $400 million in 2022 and earned $1 billion in the first nine months of 2022, making cryptocurrency a major source of revenue.
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North Korean hackers were able to get $615 million in assets in March alone, making it the largest cryptocurrency heist on record.
What began as purely espionage-based cyberattacks quickly led to large-scale and sophisticated operations to obtain cryptocurrency in order to finance missile programs and other military operations.
North Korea’s missile tests this year have cost at least $620 million, with plans to resume nuclear tests amid an economic crisis, according to Reuters.
“I remember doing interviews about the Sony hack in 2014 when a lot of the interviewers were just like, ‘Well, North Korea can’t even keep the lights on at night,'” Klingner said. “If you look at the famous satellite photos ·night beds, how could they do something like a Sony hack?”
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“Well, it was North Korea, and they’ve only gotten better,” he continued. “But even I was surprised when I was doing the research for this article last year about how they’ve expanded their cyberattacks.”
The Foundation for the Defense of Democracies (FDD) described two main ways that hackers in Pyongyang manage to steal traditional funds: first, by taking control of the financial transfer system of a bank run by the Society for Worldwide Interbank Financial Telecommunications, the famous SWIFT system; second, breach ATMs to dispense cash, which agents can collect.
But North Korea has developed long-term “phishing” operations, which involve spoofing malicious e-mail attacks against individuals or groups, in some cases developing entire profiles on websites such as LinkedIn or Facebook to convince targets of their authenticity .
North Korea committed at least 49 hacks between 2017 and 2021, according to New York-based blockchain analytics firm Chainalysis.
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Fluctuations in the crypto market this year have slowed the success of these hackers, with crypto losing 80% to 85% of its value by June 2022, but the reality is that these hackers have raised far more alarming questions about the cyber capabilities of North Korea and Western nations. ‘ vulnerabilities.
“Within the cybersecurity space, significant large-scale theft of cryptocurrencies is demonstrating North Korea’s ability to engage in both attacks that exploit cyber vulnerabilities, issues with the code itself, as well as social engineering attacks Annie Fixler, deputy director of FDD’s Center for Cyber and Technology Innovation, told Fox News Digital.
“The attacks we’ve seen have taken advantage of both where North Korean hackers can track down a UN administrator and someone [who] has access to the systems to click on a malicious link as hackers typically do,” Fixler said. “Then, in other cases, North Korean hackers have exploited problems with the code, particularly in cryptocurrency bridges, the pieces that connect differently, how you can transfer assets from one blockchain to another, blockchain for bridges.”
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“So there have been vulnerabilities in those systems that North Korea has demonstrated its capabilities and sophistication and ingenuity and determination that this is a path worth pursuing in the broader national security space.”
Fixler noted that despite the capabilities North Korea has shown, he would still rank them third compared to China and Russia, who are still “competing for the top spot on any given day,” and with Iran a distant fourth in terms of of cyber threats.
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But in all cases, rogue nations have developed “more sophisticated, more determined and more innovative” operations, according to Fixler.
He argued that North Korea’s actions indicate a long-term risk to the financial integrity, national security and traditional operations of the United States.