How North Korea Launders Billions in Stolen Cryptocurrency
Hermit Kingdom, responsible for the $1.5 billion Bybit hack, according to intelligence agencies, is facing “disruption” issues due to the scale of its haul.
Tom Carreras | Edited by Benjamin Schiller on March 7, 2025, 20:02 UTC
What you need to know:
- Since 2017, North Korea has stolen more than $5 billion from the cryptocurrency industry.
- Hackers recently made around $1.5 billion from an attack on Bybit.
- As Ari Redbord of TRM Labs reports, such a colossal amount makes the laundering process difficult.
- North Korea uses a network of over-the-counter brokers to launder money that is overseen by U.S. agencies in conjunction with Japan and South Korea.
How Does North Korea Launder Its Crypto Loot?
Every time Hermit Kingdom successfully hacks a company or protocol — like when they stole $1.5 billion from cryptocurrency exchange Bybit on February 21 — they face a major challenge in withdrawing their assets.
They cannot simply transfer funds to large exchanges like Binance or Coinbase, as such companies implement Know Your Customer (KYC) systems and work with law enforcement to immediately freeze illicitly obtained funds once they reach the platforms.
Instead, North Korea uses a sprawling network of over-the-counter brokers to launder stolen assets, according to Ari Redbord, head of global policy at blockchain analytics firm TRM Labs.
“They’ll be looking for exchanges around the world that don’t have strong compliance controls,” Redbord, who previously served as senior adviser to the deputy secretary and under secretary for terrorism and financial intelligence at the U.S. Treasury Department, told CoinDesk. “Everyone is using Chinese entities to launder money. Cartels are using them to move funds. There’s a network that the North Koreans have been using for years.”
“But it's not just China. Look at countries that have no regulation or controls on money laundering. Russia has long been known as a country that facilitates money laundering. There is a lot of dark web activity and ransomware linked to Russia. North Korea has also used casinos in Macau to launder fiat money.”
Billions Down
North Korea has never been known to use cryptocurrency for international transactions. Instead, it is trying to convert the tokens into government-issued currencies like the Chinese yuan or the U.S. dollar, Redbord said.
But dumping billions isn’t easy. According to TRM, North Korea has stolen more than $5 billion since 2017. When broken down into monthly increments, North Korea needs to dump an average of at least $51 million a month — more than its laundering network can handle.
“You inevitably see these funds sitting in wallets for long periods of time. I don't think they're creating any kind of strategic reserve; they're just unable to get the funds out,” Redbord said. “In every case, North Korea is looking to get these funds off the blockchain as quickly as possible.
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