Former North Korean Military Hackers Arrested, Cryptocurrency Laundering Scheme Exposed

Former military hackers from North Korea have been arrested for laundering state funds through cryptocurrency, drawing attention to the money laundering structure of North Korean hacking organizations. They are accused of hacking into the internal systems of the North Korean Central Bank and the Foreign Trade Bank to steal foreign currency and state trade funds, which were then transferred to cryptocurrency wallets. It is reported that after moving the stolen funds to overseas cryptocurrency wallets, they exchanged them for dollars and yuan through Chinese brokers. Cashing out occurred in real-time in border areas such as Sinuiju and Hyesan, and they reportedly avoided detection by breaking transactions into small amounts and using encrypted messengers, unregistered mobile phones, and Chinese wireless equipment. The North Korean Ministry of State Security arrested them on July 12 in a hideout in Pyongyang, after abnormal flows were detected during the foreign currency payment approval process, prompting an investigation. The money laundering methods revealed in this case are similar to the patterns of existing North Korean hacking organizations, involving the distribution of stolen cryptocurrency through various channels before converting it into fiat currency via over-the-counter (OTC) markets. According to international sanctions monitoring reports, offshore brokers in China and certain financial networks play a key hub role in the money laundering process of North Korean hacker organizations. Chainalysis reports that North Korean hackers stole approximately $2 billion through cryptocurrency hacking last year, marking the largest amount ever recorded. This incident is interpreted as a case that reveals the state-level strategy for utilizing cryptocurrency and the funding structure behind it.

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