US publishes ‘DeFi Illegal Financial Risk Assessment’ report
Assessment of Risk Factors Related to DeFi (Decentralized Finance)
“Northern hackers use DeFi to secure funds”
“They’re stealing virtual assets under sanctions pressure”
The US government has evaluated that North Korea is abusing decentralized finance, DeFi, using blockchain technology and virtual assets to finance the development of weapons of mass destruction.
The U.S. Treasury Department revealed that North Korea recently stole $720 million in virtual assets.
This is reporter Kim Jin-ho’s report.
[기자]
This is the first ‘DeFi Illegal Financial Risk Assessment’ report published by the US Treasury Department.
We evaluated various risks related to DeFi, which means financial transactions between individuals using blockchain technology and virtual assets, that is, decentralized finance.
The report revealed that hackers in North Korea are using DeFi services to transfer and launder illegally obtained funds.
In particular, the Ministry of Finance pointed out that North Korea is increasingly stealing virtual assets from virtual asset service providers and DeFi services, such as virtual currency exchanges, under sanctions and pressure from the United States and the United Nations.
As an example, the Lazarus Group, a hacking organization linked to the North Korean government, stole $720 million in virtual assets from blockchain video game company ‘Axi Infinity’ last year and blockchain technology company Harmony in 2020, the Ministry of Finance introduced.
North Korean-linked hacking organizations have also been involved in ransomware attacks related to virtual assets, and the Ministry of Finance explained that thousands of highly skilled information technology and IT workers dispatched by North Korea around the world often carry out virtual asset-related projects.
The Treasury Department warned that the system access gained by North Korean IT workers undertaking these projects could be used to enable North Korea’s malicious cyber infiltrations or to support North Korea’s money laundering activities.
The Treasury Department saw that North Korea was using these stolen virtual assets to fund development of weapons of mass destruction, WMD, and ballistic missiles.
The Treasury Department pointed out that DeFi services are vulnerable to theft because of the large amount of funds gathered in one place, no cybersecurity standards or regulations, and the concentration of authority in the administrator.
At the same time, he emphasized the need to establish a regulatory framework and strengthen management and supervision in cooperation with the international community through international anti-money laundering organizations.
This is YTN Kim Jin-ho.
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