North Korea arrests its own hackers for stealing from state banks and laundering through crypto

North Korea’s government has turned on its own cyber soldiers. On July 12, authorities arrested a group of former state cyber operators and elite IT specialists for allegedly hacking into two of the country’s own banks, the Chosun Central Bank and the Foreign Trade Bank, and laundering the stolen funds through overseas cryptocurrency wallets. The operatives, reportedly former members of North Korea’s military intelligence cyber units, are accused of siphoning state trade funds in small increments before converting the crypto proceeds into US dollars and Chinese yuan. How investigators caught them The arrests came after investigators tracked encrypted transaction traffic back to a safe house in Pyongyang. Computers and burner phones were seized during the operation, according to a report from Daily NK. The scheme reportedly involved routing stolen funds through crypto wallets based overseas, a laundering technique that mirrors the playbook North Korean hackers have used against foreign exchanges and DeFi protocols for years. No specific exchanges, protocols, or wallet addresses connected to this internal theft have been publicly identified. The Lazarus Group’s shadow North Korea’s c...