Cryptocurrency News Roundup for November 21, 2022

The U.S. Treasury Department announced that it has shut down a North Korean digital asset money laundering network

The U.S. Treasury Department announced Monday that it has shut down a North Korean digital asset money laundering network.

The network, which was operating through a Singapore-based company called Sing-Il Trading Corp., was used to launder illicit funds obtained through cybercrime, including the 2022 Harmony Bridge hack, which resulted in the theft of over $100 million in cryptocurrency, the Treasury said in a statement.

The network also laundered funds stolen in the 2021 hack of Axie Infinity's Ronin Bridge, which saw over $600 million in cryptocurrency stolen.

As part of the effort to shut down the network, the Treasury's Office of Foreign Assets Control (OFAC) has designated Sing-Il Trading Corp. and two North Korean nationals, Ri Sok and Kim Kuk Bom, for sanctions.

The designations, which were made under Executive Order 14071, prohibit U.S. persons from engaging in any transactions with the designated parties, and also freeze any assets belonging to them that are within U.S. jurisdiction.

"The DPRK continues to use illicit activities, including cybercrime and crypto theft, to generate revenue for its weapons of mass destruction and ballistic missile programs," said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. "Treasury will continue to take aggressive action to disrupt the DPRK's illicit networks and counter the threat posed by its nuclear and WMD programs."

The statement from the Treasury also noted that the Federal Bureau of Investigation (FBI) played a "critical role" in the investigation that led to the designations.

The FBI's Baltimore Field Office, which has jurisdiction over the investigation, worked closely with OFAC and other U.S. government agencies to identify and disrupt the North Korean digital asset money laundering network, the statement said.

"The FBI will continue to work with our partners to investigate and disrupt illicit activities by the DPRK, including its attempts to launder stolen funds through digital asset exchanges," said Special Agent in Charge Thomas J. Sobocinski of the FBI Baltimore Field Office. "We remain committed to protecting the American people and our financial system from these threats."

The Harmony Bridge hack, which occurred in June 2022, saw the attacker(s) exploit a vulnerability in the bridge's smart contract code to mint and sell a large quantity of synthetic ONE tokens, which were then used to purchase other tokens on decentralized exchanges (DEXs).

The attacker(s) then withdrew the purchased tokens from the DEXs and bridged them back to the Ethereum network, where they were sold for ETH and other tokens.

The total amount of cryptocurrency stolen in the hack was valued at over $100 million at the time.

The Axie Infinity hack, which occurred in March 2021, saw the attacker(s) exploit a vulnerability in the Ronin bridge's gas-free RPC node to forge withdrawals and drain the bridge's funds.

The attacker(s) then used decentralized exchanges (DEXs) to launder the stolen funds and ultimately sell them for ETH and other tokens.

The total amount of cryptocurrency stolen in the hack was valued at over $600 million at the time, making it one of the largest crypto hacks in history.