Blockchain Analysts Suspect Hackers Linked to $70M Crypto Heist

Blockchain experts suggest that hackers linked to North Korea are the likely culprits behind a substantial $70 million theft from the cryptocurrency exchange known as CoinEx. CoinEx, a platform headquartered in Hong Kong, revealed through the social media platform X (formerly Twitter) that the wallets designated for safeguarding the exchange’s digital assets had fallen victim to a cyberintrusion. It disclosed that its estimated losses amounted to $70 million, a figure it considered a minor fraction of its total holdings.

Elliptic, a blockchain research organization, conducted an analysis pointing toward the Lazarus Group, a hacking collective associated with North Korea, as the probable perpetrators of this audacious attack.

CoinEx itself refrained from directly attributing blame for the security breach, yet it did acknowledge being aware of assertions by some security companies implicating North Korean cyberespionage units. The crypto exchange remained cautious in its statements, stating that the identity of the hacker remains the subject of an ongoing investigation.

Elliptic disclosed that a portion of the pilfered assets from CoinEx was funneled into a cryptocurrency wallet address previously linked to the Lazarus Group’s illicit activities, where  stolen funds had been laundered. Additionally, these illicitly obtained funds were transacted onto the Ethereum blockchain via a blockchain “bridge,” a mechanism previously employed by the Lazarus Group for similar purposes.

Elliptic further asserted that the Lazarus Group had significantly escalated its cyber activities recently, making off with approximately $240 million worth of cryptocurrency assets in another four distinct attacks since the commencement of June.

Another blockchain research entity, Chainalysis, expressed “medium-high confidence” in North Korea’s involvement in the attack when interviewed.

This is not the first crypto heist that North Korea has been linked to. The reported amount of money stolen by hackers allegedly connected to the North Korean regime peaked in 2022, reaching an estimated $1.7 billion, a historical high. In one of the incidents reported in April, the United States implicated hackers associated with North Korea in the theft of significant amounts of cryptocurrency connected to the popular online game Axie Infinity. Specifically, digital assets valued at nearly $615 million were reported as stolen from the Ronin blockchain network, which serves as the conduit for cryptocurrency transfers in and out of the game.

Earlier allegations had suggested North Korea’s exploitation of cyberattacks to fund its missile and nuclear programs, claims which the government has persistently denied.

As hackers become even more sophisticated and daring, platforms such as HIVE Blockchain Technologies Ltd. (NASDAQ: HIVE) (TSX.V: HIVE) may need to increase their vigilance and continually upgrade their cybersecurity systems so that they don’t fall victim to hackers.

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