Lazarus Hackers Responsible for Million Axie Infinity Attack

  • By Patrick Ryan
  • Apr 18, 2022

The Lazarus hacking collective has been identified as the digital miscreants responsible for the $500+ million hack of Axie Infinity. The Lazarus hackers have also been identified as the cybercriminals responsible for additional attacks levied against businesses in the chemical sector. Lazarus, also known as Hidden Cobra, was named the guilty party by the United States Treasury Department this past Thursday.

When Did the Axie Infinity Attack Occur?

The Lazarus Group hackers conducted the hack on Axie Infinity last month. The hack resulted in a $540 million loss for the video game maker. The Treasury linked the address of the digital Ethereum wallet in which the funds were deposited to the hacking collective. That address has since been added to the Office of Foreign Assets Control’s specialist list, referred to as the Specially Designated Nationals.  

The ensuing sanctions will prevent individuals and groups based in the United States from conducting crypto transactions with the address, ultimately ensuring the hackers cannot cash additional stolen funds. All in all, digital security analysis reveals the hackers laundered slightly less than 18% of the stolen funds, equating to just under $100 million.

What Did the Attack Involve?

The theft of the crypto constitutes the second largest of its type in history. The attack centered on shifting Ethereum and more than $25 million worth of United States Dollar Coins from a cross-chain conduit that empowers crypto users to transfer digital funds from one digital currency network to the next. The attack occurred on March 23 of this year. The digital criminals responsible for the attack hacked the private keys to execute withdrawals that were not legitimate. 

The United States Dollar Coins were traded in exchange for Ethereum by way of a DEX, short for decentralized exchange, so authorities could not halt it. The Lazarus hackers bypassed anti-money laundering efforts by converting the tokens through the DEX. The hackers also sidestepped KYC checks, short for know your customer, conducted by central exchanges.

What Did the US Treasury Have to Say About the Hack?

The US Treasury noted that it appreciates the assistance provided by the FBI and additional partners in the United States government to identify the hackers behind the crypto heist. The agency’s official statement also noted that the DPRK, meaning North Korea, supported the hackers to execute the attack.

What is the Lazarus Hacking Collective All About?

The Lazarus Group is an overarching reference to digital criminals that receive financial support from the North Korean government. The hacking group has conducted digital attacks for the past half-decade. The Lazarus Group allegedly steals crypto and other currencies to help fund North Korea’s nuclear development and military progression.  

The United States State Department is offering a $5 million reward for any information that helps disrupt the Lazarus Group or other North Korean hackers. It is worth noting a United States court recently sentenced a 39-year-old digital criminal named Virgil Griffith to more than five years in prison for assisting North Korean hacking operations.

Who Else is Lazarus Targeting?

Broadcom Symantec revealed Lazarus is zeroing in on South Korean chemical companies. The attack on the hackers’ neighbor to the south seems to be an extension of its Operation Dream Job malware effort that begins with an HTM file transmitted through email or via download that spurs an infection sequence followed by obtaining a payload through a remote server.

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