UN experts point to North Korea for $ 281 million cyber theft, KuCoin likely victim by Reuters

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2/2 © Reuters. This illustration shows representations of cryptocurrencies in front of a Kucoin 2/2 logo

By Michelle Nichols and Raphael Satter NEW YORK / WASHINGTON (Reuters) – A preliminary United Nations investigation into the theft of $ 281 million worth of assets from a cryptocurrency exchange last September “strongly suggests” ties to North Korea , with industry analysts targeting Seychelles. KuCoin based himself as a victim of one of the largest reported digital currency thefts. A confidential report from independent sanctions monitors to members of the UN Security Council said that blockchain transactions related to the hack also appeared to be linked to a second hack last October, when $ 23 million was stolen. “Preliminary analysis, based on attack vectors and subsequent efforts to launder illicit proceeds, strongly suggests ties to the DPRK,” the monitors wrote, using North Korea’s formal name, Democratic People’s Republic of Korea. They accuse Pyongyang of using stolen funds to support its nuclear and ballistic missile programs to circumvent sanctions. While the report did not name the victim of the attack, the digital currency exchange KuCoin reported the theft of $ 281 million in bitcoin and various other tokens on September 25. “This must be the KuCoin hack,” said Frank van Weert, an analyst at Whale Alert – an Amsterdam-based group that tracks large movements of cryptocurrencies on the internet. “There were no other major tricks during that period.” Attempts to contact KuCoin and its CEO, Johnny Lyu, were not immediately successful. Industry insiders said hackers were trying to funnel money through decentralized exchanges, which work by organizing person-to-person currency exchanges, in an attempt to bypass centrally managed trading platforms, many of which which had quickly marked the stolen money as illicit. “According to sources familiar with both attacks, the attackers exploited ‘defi’ protocols, that is, smart contracts that facilitate automated transactions,” the UN report said. North Korea’s UN mission in New York did not immediately respond to a request for comment on the report. KuCoin has previously said that it managed to recover more than 80 percent of the digital currency stolen in September thanks in part to the work of other exchanges that froze the funds while they were in transit through their respective systems. CEO Lyu has also said that KuCoin had discovered who the hackers were, but said that, at the request of law enforcement, he would only make his identity public “once the case is closed.” In an update posted to Twitter last week, Lyu said the search for the suspects was still ongoing. North Korea has generated an estimated $ 2 billion using “widespread and increasingly sophisticated” cyberattacks to rob banks and cryptocurrency exchanges, monitors reported in 2019. In its latest report, seen by Reuters on Monday, They said hackers linked to North Korea continued to target financial institutions and virtual mints in 2020. “According to one member state, the total theft of virtual assets from the DPRK, from 2019 to November 2020” was approximately $ 316.4 million, according to the report. North Korea has been subject to UN sanctions since 2006. The 15-member Security Council has strengthened them over the years. The latest report from the UN sanctions supervisors also noted that “a clear trend in 2020 was that cyber actors from the DPRK have been carrying out attacks on defense industries around the world.”

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