Operation DRAGONCLONE is an advanced cyber espionage campaign active since March 2025 targeting China Mobile Tietong and potentially European telecom organizations connected to Chinese infrastructure. It employs sophisticated malware loaders such as VELETRIX and the VShell adversary simulation tool, delivered via malicious ZIP files exploiting DLL sideloading and anti-analysis techniques like IPFuscation. The campaign is linked to China-nexus threat groups UNC5174 (Uteus) and Earth Lamia and uses tools including SuperShell, Cobalt Strike, and Asset Lighthouse System. Its objectives include credential theft, network reconnaissance, and callback execution. Germany, France, and the UK are identified as higher-risk countries due to their telecom sectors and economic ties to China. The threat is assessed as high severity given its advanced evasion techniques and espionage intent.
