The United Nations has accused the North Korean state of stealing $281 million worth of crypto from an exchange during September 2020.
According to Reuters, the findings from a “confidential report” authored by independent sanctions monitors for U.N. Security Council members “strongly suggests” links between the hack’s perpetrators and the North Korean regime. Reuters quoted the report:
“Preliminary analysis, based on the attack vectors and subsequent efforts to launder the illicit proceeds, strongly suggests links to the DPRK.”
Reuters noted the U.N. report accuses North Korea of using the stolen funds to support its nuclear and ballistic missile programs in violation of international sanctions.
Despite the report containing few concrete details surrounding the victimized exchange, crypto data firm Whale Alert’s Frank van Weert speculated the report must be referring to the September 2020 KuCoin hack. Chainalysis estimated losses from the KuCoin hack at $275 million.
The incident saw swift reactions from Tether and major crypto exchanges to quickly freeze crypto assets associated with the attack, preventing roughly 22% of breached funds from being stolen. KuCoin says it has since recovered 80% of the stolen funds.
Citing sources familiar with the incident, the U.N. report cites asserts the attackers breached the exchange by exploiting the smart contracts of DeFi protocols:
“The attackers exploited ‘DeFi’ protocols — i.e., smart contracts that facilitate automated transactions.”
The report estimates North Korea generated roughly $2 billion in total through “widespread and increasingly sophisticated” cyber attacks targeting banks and crypto exchanges as of 2019.
The U.N. notes that one member state believes North Korea stole $316.3M worth of digital assets between 2019 and November 2020, suggesting the regime was responsible for a further $36 million worth of crypto thefts on top of the KuCoin hack during that time.
Last month, a U.S. federal judge ruled that an Ethereum developer accused of helping North Korea to evade sanctions by delivering a speech at a 2019 crypto conference in Pyongyang must soon face a jury. The developer, Virgil Griffith, is accused of conspiring to violate international sanctions by providing “services” to the rogue state.
Nervos launches $5M fund to support DeFi projects
China’s Nervos Network has launched a $5 million fund to support projects building decentralized exchanges, lending platforms, and other DeFi protocols.
According to a Feb. 10 announcement from Nervos, the fund will be used to provide cash grants and direct support to fintech and blockchain entrepreneurs.
In particular, Nervos is looking to back Defi teams building trustless decentralized exchanges, synthetic asset solutions, identity protocols, lending solutions, prioritizing projects striving for interoperability across multiple blockchain networks.
Grant applicants building on the Nervous blockchain will also be eligible to receive hands on support from Nervos’ core developer team.
Nervos is a Chinese-based open-source public blockchain that enables layer-two scaling solutions and is aiming to build an “universal, Internet-like public network.”
Nervos described the fund as a response to “backlash and controversy” regarding the centralized finance sector. In recent weeks, a retail-driven short-squeeze targeting the stock of struggling game retailer GameStop saw Robinhood and other mainstream trading platforms suspend trade in the shares.
Kevin Wang, co-founder of Nervos, said:
“People are becoming increasingly interested in blockchain and crypto because of the barriers in traditional finance, but users need to be able to easily transact on the blockchain for the space to grow and scale.”
Nervos also emphasized the “antiquated” systems underpinning legacy trading systems, such as centralized governance and inefficient settlement processes.
Nervos launched it’s CKB blockchain in 2019 with a focus on scalability. The project sought to target DeFi and asset tokenization from inception, and launched its CKB foundation to support developers working to improve the security, decentralization, and speed of the DeFi ecosystem.
Last year saw Nervos emphasize interoperability, launching a bridge between Ethereum and the CKB network in December, and a “universal passport” allowing developers to program for multiple blockchain through a single interface in the same month.
Nervos was also among the initial cohort of permissionless blockchains to integrate with China’s Blockchain Service Network last year.