US, Japan, and South Korea Accuse North Korea of $235M WazirX Hack

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On January 14th, it was collectively stated by the U.S., Japan, and South Korea that North Korea’s government-supported hacking unit, Lazarus, was responsible for a string of cyberattacks aimed at various cryptocurrency platforms globally. One of these attacks, the notable July 2024 breach of WazirX – India’s leading crypto exchange – led to an astounding $235 million in losses.

This shared declaration corroborates previous conclusions made by blockchain analysis company Elliptic, who likewise implicated North Korea in the hack of the exchange.

In their declaration, the three administrations underscored the significant danger that North Korea’s cyber actions pose to the worldwide financial network, pointing out how they jeopardize its stability and safety. The statement characterized North Korea’s cyber operations as a direct menace to the international financial system’s honesty and security.

Mounting Security Challenges

A security breach on WazirX resulted in a single multisignature wallet being compromised, causing more than 45% of the exchange’s total cryptocurrency holdings to be lost. Consequently, all trading and platform activities were temporarily halted. This event sparked a period of reflection across the industry. In November 2024, WazirX co-founder Nischal Shetty unveiled plans for resuming operations and providing compensation to affected users by February 2025.

Significantly, the WazirX hack was part of a broader issue that highlighted weaknesses within the cryptocurrency industry. As reported by the United Nations Security Council in May, cyberattacks on cryptocurrencies linked to North Korea have resulted in the theft of approximately $3 billion from 2017 to 2023. In 2023, the council investigated no less than 17 crypto heists, with a combined value exceeding $750 million.

2024 saw a significant cyber attack on WazirX, making it the second largest of its kind that year. This attack was surpassed in scale only by a $308 million raid on Japan’s DMM Bitcoin exchange in May. Notably, various law enforcement agencies such as the FBI and Japan’s National Police Agency have verified that this cyber attack was conducted by hackers linked to North Korea.

It’s worth noting that the three governments have connected the Lazarus Group to several high-profile cryptocurrency heists. For instance, they claim responsibility for the thefts at Upbit ($50 million), Radiant Capital ($50 million), and Rain Management in Bahrain ($16.13 million). Experts predict that more than half of North Korea’s foreign currency income in 2024 could be attributed to these malicious cyber operations.

Coordinated Global Response

In response to North Korea’s cyber attacks, the United States, Japan, and South Korea are strengthening their cooperation. According to the announcement, this collaboration involves imposing sanctions on DPRK hackers, attempting to recover stolen funds, and improving cybersecurity throughout the Indo-Pacific region.

As state-supported hacker organizations become increasingly complex, it’s essential that the cryptocurrency industry strengthens its cybersecurity defenses more than ever.

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2025-01-14 19:51