The recent Euler Finance exploit is the biggest attack in the crypto space in 2023. The incident was due to an instant loan attack that resulted in the loss of nearly $200 million in crypto assets.
The hacker ended up transferring the stolen funds to different crypto addresses. A report by blockchain analytics company Chainalysis links a crypto address in North Korea to the attack. The address received a transfer of about $170,000 of stolen funds from the Euler platform.
Stolen Euler Finance funds tracked by North Korean hackers
According to report, Chainalysis has uncovered another address related to North Korean hackers receiving stolen Euler funds. The analysis showed that several Ether tokens worth almost $170 million were transferred to this address. The North Korean address has been traced to several hacks in the past.
In addition, Chainalysis noted that two main network objects are involved in the exploits. There is an advanced Miner Extractable Value (MEV) bot and the hacker’s main personal wallet.
A hacker took advantage of vulnerabilities in Euler’s software that lacks collateral in the form of instant loans to borrow massive amounts of money. This action helped them manipulate the prices of the tokens. In addition, the infamous sanctioned crypto mixer Tornado Cash provided initial financial support to the attacker. He helped cover gas fees and draft contracts used in the attack.
The hacker initiated the flash loan by borrowing some $30 million worth of DAI tokens from the Aave protocol. After the attack was completed, the hacker nevertheless transferred part of the funds back to the Tornado Cash platform.
North Korea and crypto attacks
The North Korean hackers’ connection and address prove their involvement in the exploitation of Euler Finance. It may also mean that the attacker tried to unbalance the investigation by transferring some funds to the address.
However, North Korean hackers are notorious for the rise in criminal activity and attacks on decentralized finance (DeFi). In accordance with data In 2022, North Korean hackers received about $3.8 billion from the crypto industry, according to Chainalysis. This amount was higher than what they stole in previous years.
In addition, the analytics firm noted that hackers have been linked to the majority of crypto attacks in 2022. But the main victims of the group’s hacking activities are decentralized finance protocols. Attacks on DeFi protocols accounted for up to 82.1% of the group’s total hacking activities.
In February 2023 Korea Times informed that South Korea has sanctioned North Korea for crypto crimes. These were the first independent sanctions imposed by South Korea on its northern neighbor due to cyber activity.
The South Korean sanctions targeted four North Korean hackers and seven groups who allegedly helped fund the regime’s weapons program. Among the North Korean hackers sanctioned is the infamous Lazarus Group, with a large amount of cybercrime around the world.
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