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Japan Loses 30% Of Total Crypto Hacks In North Korea, Elliptic Reports

Japan has emerged with the highest losses worldwide from North Korean cyberattacks targeting crypto exchanges, as recent reports indicate that Japan’s financial institutions and individuals incurred approximately 30% of the total losses attributed to North Korean crypto hacking.

The Japanese government has been particularly vocal about the need for enhanced cybersecurity measures to combat these malicious activities. But despite ongoing efforts to bolster their defenses, Japanese exchanges have been a primary target, suffering substantial financial losses and tarnishing the country’s reputation as a secure hub for digital assets.

Japan’s 30% Crypto Losses

The Elliptic report from a leading blockchain analytics firm, Nikkei, reveals that Japan suffered a staggering $721 million in losses, accounting for about 30% of the total amount hacked globally. 

The numbers were culled from hacks that occurred between 2017 and 2022, reaching a total amount of $2.3 billion. Notably, in 2022 alone, the digital asset ecosystem lost an estimated $640 million worth of cryptocurrency.

A Reuters report from the United Nations revealed that digital currency theft exploits in North Korea hit a new high in 2022. The report also showed that the second most-attacked nation was Vietnam, losing approximately $540 million within the same period.

The United States was the third nation on the list, and Hong Kong came out in fourth place, with $497 million and $281 million losses, respectively.

Meanwhile, the Elliptic findings shed light on the vulnerability of the Japanese cryptocurrency market, including that of the Vietnamese.

It noted that both markets have lax security measures, making it an attractive target for hackers seeking to exploit weaknesses and gain illicit access to digital assets.

The significant losses incurred by Japan reflect the growing threat posed by North Korean hacking groups, which have increasingly targeted cryptocurrency exchanges and platforms worldwide.

Notable Exploits From North Korea’s Lazarus Group

The Lazarus Group is believed to act on behalf of the North Korean regime to bypass international sanctions and fund illicit activities.

This group has orchestrated some of the most significant exploits in the cryptocurrency world, with the Ronin Bridge exploit and the Harmony Bridge hack among their audacious heists.

Related Reading: DOJ Crypto Task Force Goes After DeFi Hackers As Illicit Activity Soars

Meanwhile, North Korean hackers have also been engaging in the theft of Non-fungible tokens (NFTs). But their criminal activities didn’t stop there.

They demonstrated a remarkably sophisticated strategy for laundering their ill-gotten gains. They employed decentralized crypto mixers and finance services to launder the origins of the stolen funds, making it incredibly challenging to trace their illicit activities.

This method allowed them to convert the stolen cryptocurrency into untraceable forms, further complicating any attempts to recover the stolen assets.

Japan Loses 30% Of Total Crypto Hacks In North Korea, Elliptic Reports

Featured image from Pixabay and chart from Tradingview.com

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Tornado Cash Sees Drop In Activity After U.S. Treasury Sanctions – What Now For TORN?

The value of Tornado Cash is decreasing, not due to market factors but because of recent controversies. The Office of Foreign Assets Control recently added Tornado Cash to its list of Special Designated Nationals. That means no one from the United States may use the token.

By taking this action, OFAC has effectively banned Tornado Cash from participating in one of the most important cryptocurrency markets.

Many owners of Tornado Cash’s native coin, TORN, also liquidated their investments in response to the news. From its high closing of $30.25 on August 7th, TORN has fallen 87.03% to its current price.

Tornado Cash Linked To Nefarious Activities

Even before the OFAC decided to add Tornado Cash to its special list, TORN had been linked to multiple high-value crypto crimes.

The Lazarus Group, perpetrators of one of the largest crypto thefts in history, employed TORN as part of their plot to conceal the true origin of their stolen funds. The breach was carried out on the Ronin Network, an Ethereum-based sidechain.

In March of 2022, the network hosted game Axie Infinity, which saw its highest player count. Because of this, malicious actors like the Lazarus Group were able to zero in on the system and the game with relative ease. The theft led to the loss of 173,600 Ether and 25.5 million USDC.

The total dollar amount is $625,000,000. Later this year, the OFAC will penalize the project and all connected wallets due to this attack.

Chart: TradingView.com
Sanctions Deal A Heavy Blow On TORN

It is hardly surprising that criminal actors have used Tornado Cash to launder stolen cryptocurrency. In the DeFi domain, mixers are special programs that ostensibly enhance privacy by blending transactions, so obscuring the money’s path from point A to point B.

In 2019, more than $7 billion worth of cryptocurrency was laundered using Tornado Cash, according to a U.S. Treasury Department report.

As of this writing, the sanctions have a significant impact on TORN. According to a source, there are currently only 100 unique users on the network.

After the announcement of the sanctions, transactions in excess of $100,000 became practically nonexistent.

TORN is trading just above the 38.20% Fib retracement level at the moment. This level will support the price of the crypto due to the close correlation between the buying and selling quantities of bulls and bears.

As the sanction dismantles the project, it is only a matter of time till it hits zero.

Crypto total market cap at $918 trillion on the daily chart | Source: TradingView.com

Featured image from The Daily Hodl, Chart: TradingView.com