Crypto exchanges freeze accounts linked to North Korea The Register

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Two cryptocurrency exchanges have frozen accounts identified as having been used by the notorious North Korean group Lazarus.

This story begins with a crypto researcher who goes through ZachXBT and late last week spotted an entity called Lazarus Group transferring 41,000 ETH from the Harmony Bridge hack via Railgun on January 13-14, 2023 before depositing funds on three scholarships.

1/2 North Korean group Lazarus had a very busy weekend moving $63.5 million (~41,000 ETH) from the Harmony Bridge hack via Railgun before consolidating the funds and depositing on three different exchanges . pic.twitter.com/huDumaJeSh

ZachXBT (@zachxbt) January 15, 2023

Harmony Bridge was a crypto transfer service that was attacked in June 2022, with an estimated $100 million worth of crypto lost as a result of the attack.

Analysts quickly identified Lazarus Group as the type of entity that might be interested in attacking Harmony.

The Lazarus Group is suspected to be a team of cybercriminals run by the government of North Korea and is infamous for WannaCry ransomware, attacking Sony Pictures and stealing secrets from energy companies.

He then moved on to crypto heists and was accused of stealing $620 million worth of crypto from game developer Sky Mavis, publisher of a crypto-centric game named Axie Infinity.

North Korea steals crypto because sanctions make it difficult for the rogue nation to access fiat currencies. The nation’s murderous regime is committing massive violations of the human rights of its citizens, but needs funds to continue the conventional missile and nuclear weapons programs that help keep its leaders in power by making the cost of seeking regime change that is unacceptable to nations that oppose its violent autocracy.

The US State Department, however, is offering a $10 million reward for information about the North Korean state-sponsored hack in hopes of more effectively combating North Korea’s cybercrime agenda.

While cryptocurrency enthusiasts speak lyrically about the anonymity offered by tokens, the reality is that it is possible to track their movement. The likes of the Lazarus Group therefore leave signs of their demise as they attempt to move stolen cryptocurrencies.

These attempts were spotted by ZachXBT and also noticed by crypto exchange Binance which froze accounts allegedly involved in the Lazarus Group efforts.

We have detected a movement of Harmony One hack funds. They previously tried to launder through Binance and we froze their accounts. This time he used Huobi. We helped the Huobi team freeze their accounts. Together, 124 BTC were recovered. CeFi helps keep DeFi #SAFU!

CZ Binance (@cz_binance) January 16, 2023

The Huobi mentioned in the Tweet above is another crypto exchange and it also acted to prevent the Lazarus Group from resurrecting proceeds from the Harmony heist for use by the North Korean regime.

The accounts frozen by Binance and Huobi amounted to 124BTC – $2.6 million at the time of writing.

It’s a good chunk of change to negate the regime of North Korea. And perhaps a feather in the hat for the crypto community as it grapples with its ongoing infosec, regulatory, fraud, and existential issues.

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