South Korean law enforcement, along with a government-backed cybersecurity agency, is investigating whether North Korea was involved in the hacking attacks against crypto exchange Youbit, the WSJ reports, citing people familiar with the matter.
In December, we reported that Youbit was hacked and lost 17% of its clients’ funds. This followed an attack in April 2017, when the intruders pilfered around 4,000 Bitcoins. At that time, the exchange was operating under a different name. Yapian, the company behind Youbit, subsequently halted trading and filed for bankruptcy.
Now South Korean investigators are considering North Korea as the potential perpetrator in an attempt to deal with sanctions. The investigation has just started and could run for weeks, according to the sources. However, there are specific indications and evidence that North Korea was involved in the hacking attack.
South Korean law enforcement and the Korea Internet & Security Agency revealed they had started an investigation into the hack but had yet to determine the scope of the case.
If North Korean involvement were to be confirmed, it would not be an isolated case. The country has a group of about 7,000 hackers spread around the world. The North Korean government denies having anything to do with the hacking attacks.
The reclusive state is currently advancing its nuclear weapons program amid economic sanctions, and it would be motivated to consider such radical methods.
Troy Stangarone, a senior director at the Korea Economic Institute in Washington, said:
“North Korea is an ideal country to use hacking and financial tools like . They’re experimenting with ways to earn back lost money from sanctions.”
Ryan Kalember, a senior VP at cybersecurity firm Proofpoint, said:
“Much of the cryptocurrency system is highly vulnerable. Because this world is moving so fast and now it’s so lucrative, it’s really exactly what a cybercriminal is looking for.”
In 2017, Youbit purchased a one-year cyber-insurance policy from DB Insurance, with damage coverage of about $2.8 million. According to a DB spokesperson, Youbit has not filed a claim.
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