Railgun has recently come under scrutiny for allegedly being connected with North Korea’s Lazarus Group and their illicit activities. However, Railgun has publicly denied any association with the sanctioned group, stating that their system rigorously blocks any sanctioned or malicious users from accessing their services. The claims made against Railgun have been dismissed as unfounded.
A report by Elliptic indicated that the Lazarus Group utilized Railgun to launder over $60 million worth of Ethereum stolen in June 2022. According to the analysis, the North Korean hacker group has been using Railgun as a coin mixer to conduct their laundering activities. The US FBI also mentioned in January 2023 that North Korean cyber attackers utilized Railgun for the same purpose.
Following US sanctions on Tornado Cash, the Lazarus Group reportedly shifted their laundering activities to Railgun, as per the Elliptic report. The report stated that a significant portion of funds passing through Railgun, estimated at around 70%, were from the Harmony hack. This raised concerns about the effectiveness of Railgun’s mixer, as it compromised the system’s ability to detect and prevent illicit activities.
Railgun responded to these allegations by stating that the Lazarus Group is blocked from accessing Railgun’s functions through the “Private Proofs of Innocence” system, which has been in place for over a year. The protocol clarified that all transactions go through a validation process to ensure they do not originate from sanctioned or malicious sources. Railgun refuted the claims made by Wu Blockchain and emphasized that there is no evidence to support the allegations.
While the allegations against Railgun regarding its connection with North Korea’s Lazarus Group are alarming, Railgun has maintained its stance on denying any association with the sanctioned group. The implementation of the “Private Proofs of Innocence” system demonstrates Railgun’s commitment to preventing illicit activities on its platform. As the debate continues, further investigations may shed light on the truth behind these allegations.
