A six-month infiltration campaign by North Korean hackers at Drift sent shockwaves through the crypto industry, which was already reeling from massive exploits. However, a more pressing question emerged: why does North Korea persist in targeting crypto, and what sets its approach apart from other state-backed hacking operations? According to security experts, crypto provides the regime with a vital revenue stream and helps keep it afloat. 'North Korea lacks the luxury of patience,' said Dave Schwed, Chief Operating Officer at SVRN and founder of the cybersecurity masters program at Yeshiva University.
'Under comprehensive international sanctions, they require hard currency to fund their weapons programs. The UN and multiple intelligence agencies have confirmed that crypto theft is a primary funding mechanism for their nuclear and ballistic missile development.' This sense of urgency explains why North Korean hackers carry out large-scale, traceable heists on public blockchains instead of quietly using crypto to evade sanctions like other state actors do. The answer, Schwed argues, lies in the structural differences between North Korea and other sanctioned nations.
While Russia and Iran have functioning economies and use crypto as a payment rail to work around sanctions, North Korea has almost nothing left to sell, with its exports being almost entirely sanctioned. 'Their exports are almost entirely sanctioned. They don't have a functioning economy that needs a payment rail. They need direct revenue,' Schwed explained.
'Crypto theft gives them immediate access to liquid value, globally, without needing a counterparty willing to do business with them.' This distinction - crypto as infrastructure versus crypto as a target - is what separates North Korea from Russia and Iran. While Russia and Iran use crypto to fund their proxy networks and work around sanctions, North Korea is running a state-sponsored heist operation.
'Their targets are exchanges, wallet providers, DeFi protocols, and the individual engineers and founders who have signing authority or infrastructure access,' said Alexander Urbelis, Chief Information Security Officer at ENS Labs and a professor of cybersecurity at King’s College London. 'The victim is whoever holds the keys or access to the infrastructure that holds the keys.' Russia and Iran, by comparison, view crypto as incidental, a means to broader geopolitical ends.
'Russia targets elections, energy infrastructure, and government systems. Iran goes after dissidents and regional adversaries,' Urbelis said. 'When either of them touches crypto, it's to move money, not to steal it from the ecosystem.' North Korean operatives have adopted tactics more commonly associated with intelligence agencies than criminal hackers, including months-long relationship building, fabricated identities, and supply chain infiltration. The Drift campaign is a recent example.
'You're not defending against a phishing email from a random scammer,' Urbelis said. 'You're defending against someone who spent six months building a relationship specifically to compromise one person who has the access you need to protect.' Crypto's architecture makes it a uniquely attractive hunting ground.
In traditional finance, successful hacks are slowed down by compliance checks, correspondent bank checks, settlement delays, and the possibility of reversing fraudulent transfers. However, in crypto, none of these safeguards exist at the protocol level. 'Once a transaction is signed and confirmed, it's final,' Urbelis said.
The Bybit exploit earlier last year moved $1.5 billion in roughly 30 minutes, a pace and scale that would be nearly impossible in the traditional banking system. This finality fundamentally changes the security calculus. In banking, a reasonable defense can be built across prevention, detection, and response, because there's always a window to freeze funds or reverse a wire. In crypto, that window barely exists, which means stopping an attack before it happens isn't just preferable - it's essentially the only option.
While banks operate under decades of regulatory guidance and audit requirements, many crypto projects are still improvising, often prioritizing speed and innovation over governance and controls. This gap creates an environment where even sophisticated teams can be vulnerable, particularly to the kind of long-term infiltration tactics North Korea has been refining. 'This is the hardest operational security problem in crypto right now,' Urbelis said of the challenge of vetting against sophisticated fake identities and third-party intermediaries.
'I don't think the industry has solved it.'