Crypto Hacks Stolen a Record $3.8 Billion in 2022, Led by North Korean Groups

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By Josh Smith

SEOUL (Reuters) – Last year was the worst on record for cryptocurrency heists, with hackers stealing up to $3.8 billion, led by attackers linked to North Korea who reported more than ever before, a US blockchain analytics firm said in a report. Wednesday.

Chainalysis’ report found hacking activity that “ebbed and flowed” throughout the year, with “huge spikes” in March and October. October was the biggest month ever for cryptocurrency hacking, with $775.7 million stolen in 32 separate attacks, according to the report.

The cryptocurrency market floundered in 2022 as risk appetite waned and various crypto firms crashed. Investors have found themselves with significant losses and regulators have stepped up their calls for greater consumer protection.

At the time, Chainalysis and other firms confirmed to Reuters that accounts linked to North Korea had lost millions of dollars in value.

But that didn’t deter hackers.

Hackers linked to North Korea, such as those from the cybercriminal syndicate Lazarus Group, have been by far the most prolific cryptocurrency hackers, stealing around $1.7 billion in multiple attacks last year, according to The report.

“In 2022 they broke their own flight records,” he said.

North Korea has denied allegations of hacking or other cyberattacks.

North Korea has increasingly relied on piracy to fund its missile and nuclear weapons programs, especially as publicly reported trade has shrunk, according to a panel of UN sanctions-monitoring experts. under COVID-19 sanctions and lockdowns.

“It’s no exaggeration to say that cryptocurrency hacking is a significant part of the national economy,” Chainalysis said.

For the first time last year, US law enforcement seized $30 million in funds stolen from hackers linked to North Korea.

“These hacks will become more and more difficult and less successful year by year,” Chainalysis predicted.

Targets in “decentralized finance” or DeFi, a thriving segment of the cryptocurrency industry, accounted for more than 82% of stolen cryptocurrencies in 2022, according to the report.

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DeFi applications, many of which run on the Ethereum blockchain, are financial platforms that enable crypto-denominated lending outside of traditional banks.

Last year saw a record number of crypto transactions related to illicit activity overall, reaching $20.1 billion, Chainalysis reported in January.

(Reporting by Josh Smith, editing by Louise Heavens)

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