IBM X-Force researchers have discovered new operations by the Chinese group Hive0154, better known as Mustang Panda. Experts have documented the simultaneous use of an advanced version of the Toneshell backdoor and a new USB worm called SnakeDisk, which specifically targets devices in Thailand. This approach demonstrates a targeted effort to penetrate even the region’s isolated government networks.
The new version of the malware, dubbed Toneshell9, represents a significant improvement over previous versions, thanks to built-in mechanisms to operate through corporate proxy servers, allowing malicious traffic to masquerade as legitimate network connections.
Toneshell9’s arsenal includes a dual reverse shell for parallel command execution, unique encryption algorithms based on modified random number generators, and code obfuscation techniques using neural network-generated strings.
To maintain its presence On the infected machine, DLL Sideloading is used, and communication with control nodes is masked as TLS 1.2 application data packets. The client’s design allows for the simultaneous management of multiple servers, proxies, and key sets. Of particular note is the ability to read proxy settings from the Windows registry, which indicates deep knowledge of network architectures.
At the same time, IBM specialists have identified a completely new USB worm, SnakeDisk. It activates only when IP addresses in Thailand are detected, which indicates the strategic targeting of the campaign. SnakeDisk’s activities include self-propagation via removable media, hiding legitimate files on flash drives, and installing the Yokai backdoor, previously used in attacks against Thai officials in late 2024.
This method allows attackers to bypass air gaps and penetrate critical systems physically separated from the Internet. The timing of the campaign coincides with the escalation of border conflicts between Thailand and Cambodia in 2025, adding further political context to the attack.
According to analysts, Hive0154 actively uses social engineering techniques: forged documents on behalf of Myanmar’s Ministry of Foreign Affairs were used to distribute infected archives, distributed via Box and Google Drive cloud services. Malicious files downloaded from Singapore and Thailand confirm the targeted spread of attacks in Southeast Asian countries. The group has proprietary bootloaders, backdoors, and USB worm families, which underscores its high level of development.
IBM X-Force emphasizes that Hive0154’s actions fit China’s strategic interests, where Cambodia is a key ally and pressure on Thailand is becoming a tool of regional politics. SnakeDisk’s geographic selectivity demonstrates that it isn’t a mass infection, but rather a targeted reconnaissance and intelligence gathering operation under increasingly volatile conditions.
Experts advise organizations at risk to strengthen their defenses: monitor removable media activity, analyze handshake-free TLS traffic, and carefully inspect documents downloaded from cloud services, even if they appear official. Mustang Panda continues to evolve, and its latest tools demonstrate that the threat to regional states remains serious and growing.
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