Based on the evaluation of four digital currency investigators, the precipitous decline in cryptocurrency markets has wiped out millions of dollars in assets stolen by North Korean hackers, jeopardizing a crucial stream of income for the sanctioned nation and its weapons programs.
The abrupt decline in cryptocurrency values, which began in May amid a larger economic slowdown, hinders Pyongyang's ability to profit from this and other heists and may impact its efforts to fund its weapons programs, according to two government sources in South Korea. The sources refused to be revealed due to the sensitivity of the situation.
In recent years, North Korea has put resources into stealing cryptocurrencies, making it a formidable hacking threat and leading to one of the greatest cryptocurrency heists on record in March, according to the U.S. Treasury.
North Korea has conducted a record number of missile launches this year, which the Korea Institute for Defense Analyses in Seoul believes have cost as much as $620 million, and is preparing to resume nuclear testing amidst an economic crisis.
Since the beginning of the year, the value of old, unlaundered North Korean crypto holdings monitored by the New York-based blockchain analytics firm Chainalysis, which comprise funds taken in 49 thefts from 2017 to 2021, has plummeted from $170 million to $65 million, the company said.
One of North Korea's bitcoin hoards from a hack in 2021, which was once worth tens of millions of dollars, has lost 80% to 85% of its value in recent weeks and is now worth less than $10 million, according to Nick Carlsen, an analyst with TRM Labs, another U.S. blockchain analysis firm.
The guy who answered the phone at the North Korean embassy in London stated that he was unable to comment on the crash because claims of bitcoin hacking are "completely false."
The individual, who would only identify himself as an embassy diplomat, said that they did "nothing."
The March attack on blockchain project Ronin, which powers the famous online game Axie Infinity, cost $615 million, according to U.S. investigators.
Carlsen said that it was difficult to predict how much North Korea was able to retain from the hack due to the interrelated price swings of the various assets involved.
If the same attack occurred today, the stolen Ether money would be valued little more than $230 million, but North Korea exchanged almost all of it for Bitcoin, which has experienced different price fluctuations, he said.
