North Korea Reportedly Arrests Former Military Hackers Over Crypto Laundering Scheme

North Korean authorities have reportedly arrested a group of former military cyber operatives accused of stealing state funds from two government-controlled banks and laundering the proceeds through cryptocurrency, according to a report by Daily NK. The claims have not been independently verified.

The suspects allegedly infiltrated the internal systems of the Central Bank of the DPRK and the Foreign Trade Bank, diverting foreign currency and state trade funds before transferring the assets into overseas cryptocurrency wallets. Authorities reportedly uncovered the scheme after identifying irregularities in foreign-currency payment approvals and suspicious access attempts from overseas IP addresses.

According to the report, the group fragmented transactions into numerous smaller transfers to reduce the likelihood of detection. The stolen assets were allegedly converted into cryptocurrencies before being cashed out through Chinese over-the-counter brokers, with settlement facilitated by contacts in North Korean border cities including Sinuiju and Hyesan. The network reportedly relied on encrypted messaging platforms, unregistered mobile devices, and Chinese wireless communication equipment.

Investigators are said to have traced the activity to a safe house in Pyongyang, where multiple suspects were arrested during a raid on 12 July. Authorities reportedly seized computer equipment and communication devices believed to have been used in the operation.

The case stands out because North Korea has more commonly been associated with state-backed cyber groups targeting foreign cryptocurrency exchanges and digital asset platforms. In this instance, the alleged perpetrators were former cyber intelligence personnel accused of using similar techniques against domestic financial institutions.

Blockchain intelligence firms have previously identified North Korean-linked groups as among the most active participants in global cryptocurrency theft. The reported arrests, if confirmed, highlight how crypto laundering networks involving cross-border brokers and fragmented blockchain transfers continue to present challenges for financial crime investigations and digital asset enforcement.