Crypto hacking behind N. Korea’s renewed nuclear ambition

Borders were closed and trade was cut off while international sanctions continued throughout the COVID-19 pandemic, further isolating North Korea, one of the world’s most impoverished nations. But its regime has discovered new ways of raking in funds to continuously pursue its missile ambitions and divert sanctions and regulations at the same time — via hacking cryptocurrencies.

The online theft of cryptocurrency has allowed Pyongyang free access to the new but less regulated financial system operated on blockchain technology, believed to be unhackable, through manipulation techniques that exploit human error to trick people into giving up confidential information or to download malware-ridden files.

Through such highly engineered methods, North Korean hackers have been channeling billions of dollars into the secluded regime’s pockets, according to experts from the US and South Korea.

It has become an efficient means to cover the astronomical costs of missile launches and nuclear tests for North Korea, with a gross national income that stands at 36.3 trillion won ($27.7 billion) — about 1.7 percent that of South Korea.

The pandemic has pushed the North Korean regime to further rely on cybertheft, allowing Kim Jong-un to expand his nuclear program without having to engage with the outside world.

“North Korea has engaged in a string of illicit moneymaking schemes over the decades, from manufacturing methamphetamine to counterfeiting $100 bills, and crypto theft is the latest,” said Jean Lee, a fellow at the Wilson Center in Washington and co-host of the “Lazarus Heist” podcast from the BBC World Service.

“Cryptocurrency is incredibly appealing for North Korean hackers because it promises the potential for huge gains — and remains largely unregulated.”

North Korea’s cryptocurrency theft — which began in 2017 — has begun to take center stage this year as it has fired a record-breaking number of missiles at unprecedented speed and geared up for another nuclear test despite its still-sluggish economic conditions.

This year alone, North Korea has so far fired around 90 missiles, including…