US leads the fight against North Korea crypto hacking expertise
Reactive measures taken to stop $1.5B ByBit heist, but preventing attacks is a lot harder
Welcome back,
North Korea has stolen nearly $5 billion through crypto hacks to date. It’s a staggering number—boosted by a single $1.5 billion heist earlier this year—and there’s very little that can be done to prevent future attacks beyond companies wising up and investing in better security.
On the plus side, it takes time for North Korea to turn its digital loot into usable money, and this week we look at how the US and others are trying to make that process even harder.
We also dive into China’s upcoming chip IPOs and why TikTok’s future in the US is still murky.
Have a great Monday—see you in the next edition.
Best,
Jon
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News in Focus
The US grapples with North Korea crypto hacking expertise
North Korea is making bank from crypto heists. The reclusive country is estimated to have stolen over $650 million in 2024, and this year already it has taken more than $2 billion, including $1.5 billion from a hit on ByBit. We’ve written about this before in my crypto newsletter, but the global response—particularly from the US—is ramping up
Making money in crypto is one thing, but cashing it out so you can use it in the real world—perhaps to develop nuclear weapons or groceries—is another thing. It typically requires KYC (know your customer) verification checks and bank accounts. That can be tricky for ordinary people, let alone for North Korean hackers and this is where governments are focusing their fight.
The US, in particular, is building a more sophisticated operation to locate and recover stolen crypto assets. Bloomberg reports that its Global Investigative Operations Center (GIOC)—a division of the secret service—has recovered nearly $400 million in stolen assets over the last decade.
The number sounds impressive, but compared to the amounts North Korea is stealing, it is a mere drop in the ocean. The ByBit attack shows how hard freezing crypto is. The hackers ‘successfully’ withdrew hundreds of millions within a fortnight of the attack. Nearly five months later, 5% has been frozen with 62% is “no longer traceable”—meaning one-third of the amount (around $500 million) could be recovered.
Some of the BytBit assets recently surfaced in Greece, where a wallet tied to an exchange has been frozen. It is likely that the North Korean effort will take many months, or years. That’s why US authorities are working closely with the industry and other governments to trace what they can.
It also explains the controversial decision to prosecute the creators of Tornado Cash, a service that mixes crypto to make it harder to trace. Originally designed to preserve privacy, it is popular with cyber criminals trying to hide their tracks.
The US is also trying to be proactive, but that’s an incredibly tough challenge in the crypto world.
It is zeroing in on the human element. Last week, law enforcement raided nearly 30 “laptop farms” in 16 states in response to a North Korean IT worker scheme. So far, officials have made one arrest, 29 account seizures, and taken down 32 websites. Microsoft has also suspended some 3,000 Outlook and Hotmail (lol) email accounts linked to North Korean workers.
The scale is huge and it isn’t all straight up crime. ZachXBT, who has become a notable sleuth for delving through transactions to find criminal activity, estimates that North Korean IT workers are collectively making at least $2.76 million per month working at companies. These employees are typically remote and using fake documents—some are simply doing jobs and sending money back to the regime/groups. Others may be placed to scope out vulnerabilities.
It’s tough to see how the US can stop that, other than raising awareness. Sadly, more hacks and horror stories may be what it takes.
More Chinese chip firms prepare for IPO
It is a busy time for Chinese tech listings. We wrote last week about the Hong Kong Stock Exchange heating up thanks to listings from tech companies, but there’s also plenty happening on Mainland exchanges. Two upcoming GPU makers are going public on Shanghai’s STAR market:
Moore Threads is planning to raise $1.1 billion
MetaX is aiming to raise around $500 million
Interestingly, both companies report that US sanctions are a major risk to product development, and a huge opportunity within China.
The companies aren’t linked directly, but both lost around $200 million last year due to R&D as they compete with Nvidia and others. Access to public market financing will be essential for companies like Moore Threads, MetaX and the others we mentioned last week: Reconova (AI vision), Biren and Montage (both AI chip makers) if they are to become more formidable rivals to Nvidia.
There’s clearly demand for Nvidia replacements in China, but they are likely to also look overseas. China’s top tech winners have also taken their business overseas with success as we’ve seen with telecom equipment, smartphones, cloud computing, e-commerce and now consumer AI verticals.
Elsewhere, Luxshare—a key Apple supplier—is said to be working on a Hong Kong IPO that could happen this year and raise over $1 billion.
It isn’t all sunshine and rainbows, however. Tencent and Xiaomi saw their share prices in Hong Kong fall during June, following an impressive rally.
TikTok’s US future is as unclear as ever
It gets repetitive, but the ongoing saga of TikTok’s future in the US continues to be shrouded in uncertainty. We don’t usually cover this unless there’s movement—and last week, there was. Kinda.
President Trump claimed that a group of “very wealthy people” is ready to buy TikTok US, and that Chinese President Xi will approve it.
That group? The same Oracle-led consortium—which includes Andreessen Horowitz and Blackstone—which saw its bid stall over geopolitical tensions.
Where does that leave us? Probably nowhere new. The saga might just be the price of doing business in the US as a Chinese, or simply non-US, tech firm.
TikTok has, though, made more layoffs from its e-commerce division as Trump’s tariff changes hit. Bloomberg reports that this is the third round of layoffs since April.
Data: Temu and Shein hit hard by Trump tariff change
We know those tariffs hit Chinese e-commerce players in the US hard, but now we have quantitative data.
New figures from app analytics company Sensor Tower—shared with the FT—show a huge drop between March and June:
Temu’s monthly active users fell 51% to 40.2 million from March to June
Shein’s dropped 12% to 41.4 million
This wasn’t all directly down to the US changes, which removed a loophole that had allowed goods valued below $800 to be exempt from important tax. Temu, Shein TikTok Shop and others slashed their advertising spending which had driven significant engagement. Temu was the most downloaded app in the US in 2023 and 2024, with paid advertising a key part.
Shein will be hoping to unlock growth in India, where it has teamed up with retail giant Reliance to return after being banned for years. But Reliance may need the success even more after seeing just 9% EBITDA growth last year, as India Dispatch noted.
China
The Trump administration has eased some export license rules for chip design software sales to China under a broader trade deal—Siemens AG said the US Commerce Department informed it that license requirements for doing business in China have been lifted link
GE Aerospace has also been approved to resume jet engine exports to China link
Alibaba is pledging 50B CNY ($7B) in subsidies for merchants and consumers over the next year to boost its Taobao instant commerce business in China link
Chinese AI firms are chipping away at US dominance with corporates in Asia, the Middle East and even Europe link
China-linked hackers are spoofing big-name brand websites to steal shoppers' payment info link
Enterprise AI startup BetterYeah AI, which was founded by former Alibaba executives, raised over $14M led by Alibaba Cloud link
A federal judge refused Huawei's request to dismiss over a dozen charges, including racketeering, trade secret theft, and violating US sanctions on Iran—the company must face a criminal trial next year link
ByteDance is dabbling in a food recommendation chatbot via Douyin link
Baidu is revamping its search engine with AI tools and voice search in its biggest update in years—the mobile app will act more like a chatbot, handling tasks like writing, drawing, and trip planning, with a shift toward natural language and support for multiple Chinese dialects link
China’s aviation regulator has implemented an emergency ban on some portable batteries aboard flights link
Across the country, students are using AI to bypass tighter academic rules on AI-generated content—more than a dozen universities now limit AI content in final papers to between 15-40% link
Here’s a scenario that didn’t seem likely years ago: China is pulling ahead with clean energy exports, while the US backs oil and gas—both are citing national security for their choices link
OnePlus could be the next Chinese smartphone maker to undergo Congressional scrutiny in the US link
A look at Beijing-based Noetix Robotics: it won second place in the world’s first robot half marathon, and it plans to deliver over 2,000 household robots this year—it is raising around $35M at a $200M and has doubled its team to 100 link
China’s rare earth dominance has come at a steep cost, with toxic dust and contaminated groundwater posing long-standing health risks that authorities have struggled to contain link
JD and Ant Group are pushing the central bank to approve yuan-based stablecoins in Hong Kong to counter the rise of US dollar-linked crypto and boost global use of the Chinese currency link
India
It’s been boiling since January, and reports suggest Foxconn has recalled over 300 of its Chinese engineers and technicians from its iPhone factories in India, setting Apple’s progress back with mostly Taiwanese support staff left link
However, veteran Apple supply chain expert Ming Kuo has claimed that the return of Chinese employees has had minimal impact on operations, and it was planned with Apple aware of the situation link
A look at the challenges for India’s development of its own AI foundation—structural challenges and the sheer complexity of working across dozens of languages have made it difficult but the government is pushing hard link
Agri startup Eeki raised $7M from Sixth Sense Ventures to expand operations link
AppsForBharat, maker of the Hindu devotional app Sri Mandir, raised $20M led by Susquehanna Asia—it raised $18M less than a year ago with Elevation Capital and Peak XV among its backers link
B2B ecommerce platform Jumbotail raised $120M led by SC Ventures, Standard Chartered’s fund—the valuation cross $1B link
Max Financial says a hacker accessed customer data from its insurance unit link
Southeast Asia
Alibaba is doubling down on AI in Southeast Asia, opening new data centers in Malaysia and the Philippines and launching a global hub in Singapore link
Binance plans to keep hundreds of staff in Singapore despite new laws cracking down on exchanges that aren’t licensed in the market link
Malaysian semiconductor designer SkyeChip is planning an IPO after consecutive years of revenue and profit growth, according to its CEO link
The Trump administration is preparing to block AI chip exports to Malaysia and Thailand to block off potential routes to smuggle Nvidia products into China link
South Korea
South Korea’s sovereign wealth fund plans to boost investments in tech startups and VC funds to deepen exposure to AI and other disruptive technologies link
Bank of Korea paused its CBDC project as local stablecoin adoption picks up speed link
Samsung is delaying its Texas chip plant as it struggles to secure customers link
Japan
ByteDance launched its TikTok Shop e-commerce platform in Japan link
SoftBank received over $17.3B in investor bids for its dollar and euro bonds to accelerate its global push into AI link
But the firm’s plan to acquire semiconductor design firm Ampere for $6.5B looks likely to be subject to additional US FTC review link
Taiwan
Taiwan is creating an offshore wind industry to fuel its semiconductor factories link
TSMC is delaying its second Japan plant as it ramps up US investments, partly to get ahead of potential Trump-era tariffs link
Foxconn posted a 15.8% jump in quarterly sales, driven by strong demand for AI servers and iPhones link
Rest of Asia
Amazon is hiring government sales leads in Japan, South Korea, and Taiwan to support its Project Kuiper satellite internet push in East Asia link
Kazakhstan is following the US with a plan to launch a national cryptocurrency reserve that will use seized assets and state-mined coins link
Australian startups lag the US and China in funding but lead globally in unicorns per dollar raised, with 1.22 unicorns per $1 billion invested since 2000, per a Side Stage Ventures study link
Microsoft is closing its local operations in Pakistan link