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State-sponsored North Korean hackers have been accused of targeting South Korean bitcoin exchanges with cyberattacks and hacking attempts by a South Korean official.

According to a report in Radio Free Asia (RFA), a non-profit news Eastern Asian news agency, at least one or two domestic bitcoin and digital currency exchanges were the target of an attempted hacking by the country’s neighbors to the north. Leading the accusation is Simon Choi, an official of South Korea’s Cyber Warfare Intelligence Center (CWIC).

The hacking attacks included phishing attempts, according to Choi, who claimed that malware-laden emails were sent to targeted firms in the country. The emails would frequently see its senders’ purported claims of representing a South Korean government entity in an attempt to garner trust from a victim. The malware attached to these emails had the footprint of viruses originating from North Korea, according to the CWIC.

Bitcoin = Safe Haven Foreign Reserve?

As to why North Korean hackers are attempting to hack digital currency exchanges, Professor Lim Jong-in of the Graduate School of Information Security at Korean University has a theory. “[Y]ou can conceal the identity of the virtual money owner…while securing a new source of foreign currency,” the academic told RFA.

Earlier this year, a South Korean cybersecurity firm claimed that North Korean hackers stole bitcoin worth 100 million won, approx. $90,000, every month between 2013-2015. The theft, they claim, was to increase their reserves of hard or safe haven currency.


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Choi also revealed that hacking attacks from the north also targeted blockchain startups, beyond bitcoin exchanges.

It was “not only one or two exchanges where attack attempts have been made,” claimed CWIC’s Simon Choi, before adding:

Startups that use blockchain, financial technology sector companies as well as others, may have been the target.

The hacking claim comes in the months following a significant data breach suffered by South Korea’s largest bitcoin and Ethereum exchange, Bithumb. The personal data belonging to an estimated 31,000 users were leaked due to voice phishing. According to one report, the stolen data was used to steal “hundreds of millions of won” that were withdrawn from Bithumb user accounts.

Korean authorities launched an investigation into the breach and the exchange has since offered a compensation of 100,000 won ($86) to all users impacted by the breach.

Featured image from Shutterstock.

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Posted by Samburaj Das