US-South Korea Alliance Strikes Back Against North Korea Crypto Hacks

- North Korean Hackers as Principal Perpetrators of Cryptocurrency Theft - US-South Korea Joint Research Initiative Announcement [Unblock Media] The announcement that the United States and South Korea are launching a joint research initiative to prevent cryptocurrency asset theft is a highly significant development. This move can be interpreted as a commitment by both countries to combine their technological capabilities and resources to establish a more robust security system. According to a recent announcement, the U.S. Department of Homeland Security and the South Korean government have agreed to jointly develop technologies to protect cryptocurrency platforms and infrastructure and trace stolen assets. This emphasizes that researchers from both countries will focus on how stolen financial assets are converted into cryptocurrencies like Bitcoin, cleaned, and laundered through illegal ransomware or other means. The reason the U.S. chose South Korea for this collaboration is that North Korea is believed to be a major perpetrator of cryptocurrency hacking. North Korea employs various methods including exploiting smart contract vulnerabilities, phishing attacks to compromise individual wallets, in addition to crypto mixers and ransomware attacks. In August 2022, Chainalysis, a blockchain analytics platform, analyzed that “North Korea is behind most of the cryptocurrency theft incidents occurring from decentralized financial protocols,” estimating that North Korean-affiliated groups had stolen approximately $1 billion worth of cryptocurrencies from DeFi protocols as of 2022. Chainalysis noted, "Many high-value thefts are linked to malicious actors associated with North Korea, especially elite hacking organizations like the Lazarus Group," indicating that North Korea is perceived as a principal actor in global cryptocurrency theft and laundering activities. Additionally, earlier this year, a member of a United Nations expert panel disclosed that North Korea uses crypto mixers like Tornado Cash to launder stolen cryptocurrency assets. Tornado Cash is a privacy protocol operating on the Ethereum blockchain that provides services to anonymize users' cryptocurrency transactions, drawing criticism for its use in illegal money laundering and hindering the tracing of criminal funds. It is reported that North Korea uses the proceeds from these cryptocurrency hacks to fund its nuclear and missile programs. Considering these circumstances comprehensively, the combined efforts of the US and South Korea appear to be a timely and essential response. Through this collaboration, a more strengthened security system is expected to be established, which is anticipated to have a positive impact on the overall cryptocurrency ecosystem. Various legal measures and research initiatives will undoubtedly play a crucial role in enhancing the reliability and safety of cryptocurrencies.