The exponential rise in value of cryptocurrencies in 2017 attracted the attention of the world. It gave rise to establishment of cryptocurrency exchanges in various countries. As the market rose to multibillion industry, it came on the radar of hackers. Many cryptocurrency exchanges were hacked and digital currency mining companies were attacked. Digital currency of millions in value was stolen in every attack. Lack of government backing and lack of secure encryption on some of the platforms encouraged hackers to steal money. Many countries such as Russia and Australia took interest in getting ahead in cryptocurrency mining, while some countries such as South Korea planned to ban cryptocurrency exchanges in their countries. On the other hand, hackers from some countries targeted specific countries to steal digital currency.
Recently, Reuters reported that hackers from North Korea stole currency worth of billions of won from South Korea exchanges in 2017. Moreover, South Korea outlined that its neighbor has still been trying to hack into their exchanges. Kim Byung-kee, a member of South Korea’s parliamentary intelligence committee, said, “North Korea sent emails that could hack into cryptocurrency exchanges and their customers’ private information and stole (cryptocurrency) worth billions of won.”
Byung-kee did not reveal any information about exchanges that were targeted. He added that the country’s intelligence has been trying to prevent the hackers from breaking further. Sources told Reuters that hackers from North Korea were behind the biggest heist in the history worth $530 million in Japanese cryptocurrency exchange Coincheck. Those sources informed Reuters that officers from the National Intelligence Service did not offer any firm evidence to lawmakers but outlined the possibility. One of the sources told the reason for cryptocurrency exchanges being on target of hackers. The huge size of the global market and lack of strict regulations make these cryptocurrency exchanges vulnerable for hackers.
In one of the biggest thefts of cryptocurrency, NEM virtual coins of worth 58 billion yen ($530 million) were stolen. Japanese government is on the mission to clean up all the other cryptocurrency exchanges in the country after this heist. Japanese authorities recently paid a surprise visit and checked its system. However, the authorities warned Coincheck to fix security flaws in its network before the theft.
Yoshihide Suga, Japan’s top government spokesman and Chief Cabinet Secretary outlined that they were aware of North Korea’s cyber attack capabilities. Moreover, they have been collecting and analyzing information on their hacking capabilities. However, he did not comment further or mention specific analysis.
Targeting cryptocurrency exchanges is one of the best options to convert the virtual currency into hard currency. Due to lack of stringent regulations, the theft from one exchange and distribution of stolen money into different exchanges may help in utilizing the money. The regulatory scenario has not emerged yet and lack of jurisdiction in different exchanges makes cryptocurrency an alluring option for hackers. But only time will tell whether countries help hackers to steal money from the exchanges.