US Recovers $30 Million From North Korea-Linked Crypto Heist
US seizes over $30 million in cryptocurrency stolen from online game Axie Infinity by North Korean-linked hackers, blockchain intelligence firm Chainalysis so on Thursday.
Hacker group Lazarus stole over $600 million from the online game Axie Infinity earlier this year. (Photo: B_A, Pixabay, License)The intelligence agencies’ blog post said the recovery of the funds, which were stolen by the Lazarus Group, a North Korean hacking group linked to several crypto thefts, saw the combined efforts of US law enforcement and cryptocurrency organizations, including Chainalysis.
The amount recovered is only a small fraction of the more than $600 million looted by the Lazarus Group in March from the Ronin Network, a sidechain built for the Axie Infinity game. The current value of the stolen funds equals $250 million, accounting for price differences between the time stolen and seized, and it will take some time for the seized funds to be returned to the US Treasury, so Ronin.
Much of the hackers’ proceeds from the robbery last spring were laundered through the cryptocurrency mixer Tornado Cash – a service that mixes virtual currencies by pooling funds and then redistributing them to contributors, which mystifies the trail of transfers, forming the origin or destination of the money. difficult to trace.
The US Treasury Department sanctioned Tornado Cash last month for its role in laundering over $455 million in cryptocurrency stolen from Axie Infinity. According to the US Treasury Department, “mixers like the Tornado are often used by illegal actors to launder funds, particularly those stolen during significant robberies.”
The blacklist was seen as an overreach by some Tornado Cash users who saw the mixer as a neutral tool and used it for financial privacy. Just last week, crypto exchange Coinbase said it was funding a lawsuit against the US Treasury Department to block government sanctions barring Americans from Tornado Cash.
Tornado Cash is not the only mixer sanctioned by the US authorities due to the heist. In May, the US Treasury Department blacklisted Blender, another cryptocurrency mixer, for handling over $20.5 million in cryptocurrency stolen from Axie Infinity by the Lazarus Group.
According to the Treasury Department’s May 2022 statement sanctioning Blender, the United States fears that North Korea is using the proceeds laundered from cyber heists to “generate revenue for its illicit weapons of mass destruction (WMD) and ballistic missile programs.”
Chain Analysis estimated that so far in 2022, “North Korea-linked groups have stolen approximately $1 billion of cryptocurrency from DeFi protocols,” referring to decentralized finance, an umbrella term for peer-to-peer financial services on public blockchains.
This is not the first time the US has recovered money stolen by Pyongyang-backed hackers since the beginning of the year. In July, they seized roughly half a million dollars worth of cryptocurrency from North Korean hackers targeting healthcare workers.
