True Spies: A Hack on Taiwan’s Semiconductor Industry Could Lead to Chaos


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Taiwan controls more than 60 percent of the world's semiconductor foundry market so a successful hack on manufacturers would be an attack on the tech world. Semiconductors are an essential component in electronics from smartphones to refrigerators, nuclear facilities, and missile bases.

Hackers could cause mayhem - not just to hospitals or power grids but an attack could even disable your car or laptop. In fact, you may have already been compromised.

“All prevention is going to fail at some point,” CyCraft tech expert Chad Duffy told SPYSCAPE’s True Spies podcast. “And all of these mechanisms you put in place, no matter how many put in place, a hacker will find a way to get through.”

Taiwan - a tiny island of 24m people southeast of mainland China - is on the frontline of the cyberwars. ​​One company alone - the Taiwan Semiconductor Manufacturing Company - has more than 65,000 employees and supplies more than 90 percent of the global supply of the most advanced category of mass-produced semiconductors.

The eye-watering figures are precisely why Duffy and fellow CyCraft tech expert C.K. Chen are determined to stop cyber-terrorists from infiltrating Taiwan’s semiconductor sector.

But where is the threat coming from? And how close have hackers come?

True Spies: A Hack on Taiwan’s Semiconductor Industry Threatens Chaos
A view of Taiwan's capital Taipei

True Spies: A Hack on Taiwan’s Semiconductor Industry Could Lead to Chaos

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Listen to True Spies podcast |
Trade Secrets

Taiwan controls more than 60 percent of the world's semiconductor foundry market so a successful hack on manufacturers would be an attack on the tech world. Semiconductors are an essential component in electronics from smartphones to refrigerators, nuclear facilities, and missile bases.

Hackers could cause mayhem - not just to hospitals or power grids but an attack could even disable your car or laptop. In fact, you may have already been compromised.

“All prevention is going to fail at some point,” CyCraft tech expert Chad Duffy told SPYSCAPE’s True Spies podcast. “And all of these mechanisms you put in place, no matter how many put in place, a hacker will find a way to get through.”

Taiwan - a tiny island of 24m people southeast of mainland China - is on the frontline of the cyberwars. ​​One company alone - the Taiwan Semiconductor Manufacturing Company - has more than 65,000 employees and supplies more than 90 percent of the global supply of the most advanced category of mass-produced semiconductors.

The eye-watering figures are precisely why Duffy and fellow CyCraft tech expert C.K. Chen are determined to stop cyber-terrorists from infiltrating Taiwan’s semiconductor sector.

But where is the threat coming from? And how close have hackers come?

True Spies: A Hack on Taiwan’s Semiconductor Industry Threatens Chaos
A view of Taiwan's capital Taipei

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The foundation of tech

Essentially, semiconductors are materials that have a conductivity between conductors (generally metals) and nonconductors or insulators (including most ceramics). So hacking semiconductors is a bit like hacking the core of the digital supply chain. 

Taiwan doesn’t just produce raw materials. It also makes chips and processors - the brains - that power our digital lives. Could the country that controls those chips control the world? Maybe. 

“You're looking at power grids, and hospitals, and controlling water flow, and things like that. If you start to mess up those systems, you can cause major damage somewhere,” Duffy told True Spies. 

That’s why Duffy and Chen are working to ensure we don’t find out the hard way.

 Taiwan Semiconductor Manufacturing Company is the world's largest semiconductor foundry

White-hat hackers


Duffy and Chen are called white-hat hackers, the ‘good guys’ who help organizations ward off cyber attacks and APTs - advanced persistent threats. Duffy, a former software engineer and a graduate of the University of Texas, Austin, is based in Taiwan’s capital, Taipei. Chen is CyCraft’s senior researcher and a graduate of Taiwan’s National Chiao Tung University. 

They’re used to dealing with day-to-day cyber-security issues and protecting their clients’ most valuable assets. Between 2018 and 2019, they noticed a lot of unusual attacks popping up - all of them on semiconductor vendors. And in recent years, they’ve also noticed an increase in supply-chain attacks with hackers hiding within a normal program.

Luckily, Duffy and Chen have adapted to this method of attack which proved crucial as they tried to understand the threat that landed on their desks one fateful day in November 2019. It happened at the Hsinchu Science Park, about an hour southwest of Taipei, a vital hub for the most important semiconductor companies in Taiwan. 

If you’re thinking they moved in immediately to neutralize the threat, think again. Like all good tradecraft, white-hat hacking relies on intelligence. Sometimes you want to let the attacker reveal their intentions. The hackers may just be after trade secrets for their own commercial gain, but there’s also the worst-case scenario: a world superpower holding the globe’s computers hostage.

How far were Chad and C.K. willing to go?

True Spies: A Hack on Taiwan's Semiconductor Industry Would Threaten Chaos


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