The recent $41 million hack of the crypto gambling site Stake.com shook the gambling world. Now, the Federal Bureau of Investigation has called out state-sponsored North Korean hackers as the prime suspect.
The U.S. law enforcement agency has pointed towards the notorious Lazarus Group of the Democratic People’s Republic of Korea (or DPRK) as the culprits behind this massive cyber heist.
“The FBI investigation has revealed that DPRK cyber actors moved stolen funds associated with the ethereum, Binance Smart Chain (BSC), and Polygon networks from Stake.com,” said an official FBI press release.
“The FBI will continue to expose and combat the DPRK’s use of illicit activities to generate revenue for the regime, including cybercrime and virtual currency theft.”
The FBI document also attributes July’s $31 million Alphapo hack to the regime-sponsored cybercrime group. That incident effected operations at U.S.-facing crypto offshore sportsbooks like Bovada, which used Alphapo as a crypto payment provider.
The FBI’s Findings
The DPRK, more widely known as North Korea, is an impoverished dictatorship. Its status as an international pariah, for the most part, means state leader Kim Jong Un has resorted to vast scale state-led criminal activity to fund the country.
One such group is the infamous Lazarus Group. This isn’t the first time Lazarus has been in the limelight, either.
They are known for their state-led cyberterrorist activities, and have been linked to numerous high-profile cybercrimes over the years. Their modus operandi often involves cybercrimes designed to financially benefit North Korea’s regime, led by Kim Jong Un.
The FBI’s probe into the Stake.com incident was extensive. They managed to trace the stolen funds to various virtual currency addresses associated with the Polygon, Binance Smart Chain (BSC), and ethereum networks. In total, 33 crypto addresses were identified that received the stolen funds.
This list comprised four ethereum addresses, five Binance Smart Chain addresses, two polygon addresses, and twenty-two bitcoin addresses.
While the hack was significant, Stake.com’s founder and CEO Ed Craven seemed relatively calm after the incident. He took to social media to assure users that their funds were safe.
“Stake keeps a small portion of its crypto reserves in hot wallets at any given moment for these very reasons,” he said on X, in reply to Stake.com’s official post.
Increasingly Sophisticated Scams
The Stake.com hack is a stark reminder of the vulnerabilities that exist within the online gambling and crypto sectors.
With the increasing integration of cryptocurrencies into various industries, the threats posed by sophisticated cybercriminal groups like the Lazarus Group become even more pronounced.
According to the FBI and the U.S Treasury, Lazarus was responsible for several other prominent crypto hacks in 2023. That included the Ronin Network, linked to the crypto game Axie Infinity, which in April this year lost more than $600 million.
The FBI estimates that total North Korean gains from crypto hacks across the globe could be as much as $2 billion since 2018.
In other scam news, U.S. brick & mortar casino cages might not need to be so worried about crypto hacks. But offline thieves are also getting more sophisticated.
Online DDoS attackers saw gambling operators as the second-most popular target of 2023, cyber security firm Cloudflare said earlier this year.
U.S. casinos have also been targeted by criminals using spoof phone numbers and voice changing software to impersonate management, with the aim of convincing employees to hand over cash or transfer funds.
Such incidents have been increasingly common in 2023, starting with March’s theft of $500,000 from the Monarch Casino and Resort in Colorado.
