Defiance Capital Founder: “North Korea Intends To Attack All Known Crypto Companies”

DeFiance Capital founder Arthur Cheong warned that North Korean-backed hackers have developed sophisticated methods to target crypto companies.

On Friday, Cheong tweeted that these hackers are using new forms of social engineering designed to “breakthrough our mental defenses.” He claims that this information comes from research and conversations with leading cybersecurity experts.

At the forefront of these coordinated attacks is BlueNorOff, a North Korean-sponsored cybercriminal organization, Cheong said.

“Based on our research and conversations with leading cybersecurity experts, we believe that BlueNorOff is running an organized campaign that targets every known organization in the crypto sector,” Cheong wrote.

A cryptocurrency expert said he only decided to make his findings public so that the entire crypto industry would be on high alert. He said the group was very resourceful and determined and there is nothing to predict what they are capable of:

“They may even change the tools and attack pattern in the future. As soon as the current attack method becomes less effective, such as the recently discovered DeFi trojan and wallet attack. Given the success, it is likely that North Korea will allocate more resources to this group in order to increase the intensity of attacks.”

Cheong seems to have a personal score with these “North Korean hackers” given that he was the victim of a social engineering attack last month. Using spear-phishing emails, the hackers were able to deploy malware on his device and extract the seed for his hot wallet. He lost $1.7 million worth of NFTs in the attack.

He stated that evidence provided by the cybersecurity firm confirms that BlueNorOff was behind the attack.

The Twitter thread not only highlighted the security risks but also suggested some solutions. Cheong advised companies and individuals in the crypto industry to be more careful. He recommended using enterprise-grade multi-signature hardware wallets for transactions.

He warned that crypto firms should take extra care when hiring new team members. According to him, these hackers are trying to infiltrate crypto companies. There were times when job seekers couldn’t “match their profile to their resume.”

Is North Korea under US supervision?

Cheong’s warning followed a US Treasury Department revelation that North Korean hackers were behind the $625 million Ronin (RON) bridge exploit. The crypto industry has already lost over $1 billion in the first quarter of 2022, which is indicative of the extent of the losses suffered this year.

The US government has also offered a $5 million reward for information that could help stop cybercriminals they believe are backed by North Korea.

In another case, a US court sentenced former Ethereum developer Virgil Griffith to five years in prison for providing technical information on how North Korea can avoid sanctions.