Report: North Korea-Sponsored Hacks Comprise 65 Percent of Total Crypto Stolen

Hacker group “Lazarus,” reportedly funded by North Korea, has stolen a staggering $571 million in cryptocurrencies since early 2017, a study conducted by cybercrime company Group-IB reveals. Key takeaways from the study were published Tuesday, Oct. 16, alongside the full annual report, entitled “Hi-Tech Crime Trends.”

The report, dedicated to hacks in 2017 and 2018, identifies the allegedly state-sponsored hacker group Lazarus as responsible for $571 million of the $882 million total in crypto that was stolen from online exchanges during the studied time period; almost 65 percent of the total sum.   

Out of fourteen separate exchange breaches, five have been attributed to the group, among them the industry record-breaking $532 million NEM hack of Japan’s Coincheck this January.

The report states that hackers target cryptocurrency exchanges using mostly “traditional” methods, including spear phishing, social engineering, and malware:

“After the local network is successfully compromised [through downloaded malware], the hackers browse the local network to find work stations and servers used working with private cryptocurrency wallets.”

The report, which also includes a cybercrime forecast, predicts the number of attacks on exchanges to increase in future, as an alternative to traditional targets such as banks.

Group-IB further indicates that Initial Coin Offering (ICO) platforms are prime targets for hackers, revealing that 10 percent of total funds raised from token sales in 2017–2018 were stolen. A majority of illicit activity targeting ICOs was reportedly conducted through phishing methods, with Group-IB estimating that large phishing groups have the capacity to steal around $1 million a month.

Additionally, Group-IB suggests that mining pools could prove an easy target for 51 percent attacks by state-sponsored hackers. Attempts at such attacks, albeit with limited success, are said to already be on the rise.

U.S. experts have previously alleged that North Korea is “increasingly” turning to crypto as a tactic to circumvent sanctions, claiming that the country’s government is hiring people to “launder” cryptocurrencies via multiple wallets and exchanges, as well as so-called mixing services, with the aim of obtaining sanction-free U.S. dollars.

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No Coins for You! North Carolina Rejects Bitcoin Campaign Donations


North Carolina has barred electoral candidates in the state from accepting campaign donations made in bitcoin and other cryptocurrencies. This declaration is contained in a response from the North Carolina State Board of Elections Campaign Finance Office to Emmanuel Wilder, a Republican candidate running for a seat in the state’s legislature.

Regulatory Snafu

Earlier in the year, Emmanuel Wilder had asked the State Board if he could accept campaign donations in bitcoin and other digital currencies. In his submission, the candidate also suggested a framework for the Board to use in ascribing value to the volatile asset class.

The Board communicated its refusal of his request in a letter from its executive director, Kim Westbrooks Strach. The refusal is hinged on the fact that the state’s campaign finance regulations set monetary limits in U.S. dollars. The Board is also of the opinion that cryptocurrencies cannot be reliably valued.

An excerpt from the letter reads:

“We do not have the confidence that we could adequately regulate contributions to a political campaign in North Carolina in the form of cryptocurrency.”

In his reaction, a disappointed but optimistic Wilder said:

“Blockchain and other technologies hold the ability to improve how business and public institutions operate day to day…Although it might not be today, there will be a day when this technology will have a place in the political process.”

Anonymity Concerns

emmanuel wilder bitcoin north carolina
Emmanuel Wilder (Left, with fmr. Gov. Jeb Bush) was told that he may not accept bitcoin donations. | Source: Facebook

A number of political commentators believe that the perceived anonymity afforded by bitcoin and other cryptocurrencies is a big consideration and an issue that could potentially undermine campaign finance rules. Jen Jones, a spokesperson for Democracy North Carolina, a campaign finance watchdog earlier advised the Board to take this issue into consideration.

She said:

“[The board should consider] whether it’s possible for candidates to receive campaign donations via cryptocurrency while also complying with state disclosure requirements.”

North Carolina is not the only U.S. state to prohibit cryptocurrency campaign donations. In 2017, the Kansas Governmental Ethics Commission  ruled that candidates running in state and local elections are not allowed to accept bitcoin campaign donations. 

In June, Austin Petersen, a U.S. candidate from Missouri was forced to return a $130,000 bitcoin donation because it was over the FEC-mandated individual contribution limit of $5,400.

It will be noted, however, that the Federal Election Commission (FEC) ruled in 2014 that federal election candidates are allowed to collect contributions in bitcoin and gave guidelines for such collections. Under American law, though, states are at liberty to set their own rules for state election candidates.

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Bitmain to Open New Data Center in Texas as North American Expansion Continues


Bitmain, the world’s largest bitcoin mining firm, is preparing to open a new data center in Texas, external job postings show.

The China-based cryptocurrency company, which reportedly recorded $1.1 billion in profit during the first quarter, is currently looking for a project manager and data center site manager to staff a new plant in Rockdale, TX, a small town nestled an hour-and-a-half south of Waco.

The news was first reported by local media outlet KXAN, who said that residents are hopeful that the new bitcoin mining operation will bring hope to a region devastated by job cuts in the coal production and manufacturing industries.

In 2014, Aluminum manufacturer Alcoa shut down production at its Rockdale smelting plant, which had opened in 1952 and processed as much as 1.67 million pounds of aluminum per day.

Earlier this year, Dallas-based utility company Luminant shut down its coal-fired power plant in Rockdale, cutting approximately 450 jobs at the plant and a nearby coal mine.

Consequently, residents say that they are optimistic that Bitmain’s new data center will bring high-paying skilled jobs to the community.

“These are technical jobs, these are well-paid jobs,” said Rebecca Vasquez, chair of the local Chamber of Commerce, adding that she hopes the business will bring new homeowners to the area and increase its tax base.

However, as one unnamed cryptocurrency investment fund manager noted in the report, cryptocurrency mining industry operations tend to be “capital-heavy and human-light,” so it’s not clear how many long-term jobs the new data center will bring to the area.

Bitmain is also hiring staff in Chandler, AZ, as well as two cities in Washington — Malaga and Wenatchee — as it strengthens its growing foothold in the North American market.

Earlier this month, Bitmain opened a 20,000 sq. foot office in the heart of Silicon Valley, a move concurrent with its desire to follow up its recent $400 million funding round with another $1 billion in financing ahead of its planned initial public offering (IPO) later this year.

The firm has also established a major data center in Quebec, which has a large surplus of electricity but has nevertheless had a complicated relationship with the cryptocurrency mining industry.

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