Lost Crypto? How Bitquery Helped Trace 180,000 USDT in a Crypto Scam
The growing threat of crypto scams
The prevalence of cryptocurrency scams has risen sharply, posing challenges for victims and investigators. Complex fraudulent technologies have made individuals and institutions work hard to recover stolen funds.
This article highlights a recent case where the victim lost $230,000 in a crypto scam. Using blockchain analysis, 180,000 USDT was successfully tracked.
How does a scam happen
Unregulated cryptocurrency dealers
Through social media contact, victims are introduced to unregulated cryptocurrency dealers. These dealers facilitated the exchange of local currencies to USDT, bypassing traditional financial channels.
Fake trading platform
The scam involves a fraudulent trading application designed to mimic legitimate platforms. The victims were deceived into thinking they were investing in high-return assets. Payment screenshots are manipulated to create a false sense of security.
Transfer directly to the scammer
The victim’s funds were not sent to a wallet controlled by the scammers, rather than being held on the trading platform. Provide the same destination address through fake platform and direct message.
Money laundering technology
After receipt, the funds were quickly spread through multiple wallets using the peel chain method. This technology-scattered deal makes it even more difficult to track and recover stolen USDT.
Challenge to restore stolen cryptocurrencies
Technical Complexity
Scammers often use advanced technologies such as divesting chains, a way to split transactions into smaller chains to cover up traces of stolen funds. This is especially common on low-income networks such as Tron, so criminals are cost-effective in executing complex money laundering programs.
In addition, the widespread flow across multiple wallets and chains adds a level of complexity, testing the limitations and investigation efforts of blockchain tracking tools.
Legal and law enforcement barriers
Investigative agencies often face limited familiarity with blockchain technology, which can hinder their ability to effectively handle encryption-related cases. This knowledge gap can delay recovery efforts and make it more difficult to interpret blockchain evidence.
Furthermore, cases involving unnamed defendants and cross-border jurisdiction present significant challenges. Coordinating with international institutions and browsing various legal frameworks requires a lot of resources and expertise.
Bitquery’s contribution to the case
Tracking funds
Bitquery’s Advanced Blockchain In this case, the analytical function plays a central role. By generating detailed blockchain analytics reports, Bitquery tracked $180,000 of stolen. This includes determining law enforcement transaction flows, exchange accounts and potential prospects.
How Bitquery achieves this:
- Track specific funds: Bitquery’s CoinPath MoneyFlow tracks specific transfers of multiple encrypted addresses and blockchains.
- Automatic tracking and clustering: Proprietary automated clusters help effectively navigate complex flows of funds, minimizing manual interventions and errors.
- Intuitive visualization tools: Investigators can leverage the clear visual representation of Fund Mobile, add notes/tags, and share reports easily.
- Tracking chaos of funds: Advanced accounting technologies such as FIFO, Filo, Lifo and PIFO can effectively track mutually financed assets.
Support victims and law enforcement
It turns out that Bitquery’s scam report is crucial. These reports simplify the process of participating in exchanges such as Binance and OKX to obtain KYC details and freeze illegal funds.
For victims seeking to report crypto scams, resources in specific regions can provide direct support and enhance opportunities for recovery:
- India: Victims can use this report to encrypt scams guideoutlines the appropriate channels and procedures in India.
- USA: this US Reporting Guide Details the steps to report crypto-related fraud and scams in the United States.
- Europe: For European victims, this resource Provide information on where to report crypto scams in various jurisdictions.
- China: Victims in China can report cryptocurrency fraud to the Ministry of Public Safety Economic Crime Investigation Department or the local Public Safety Bureau. You can also report crimes to the China National Anti-Fraud Center. Most interactions with the Anti-Fraud Center are through its dedicated “National Anti-Fraud Center“App. You can use the Anti-Fraud Hotline 110 to report fraud crimes.
- Taiwan: In Taiwan, victims can file a complaint with the Anti-Fraud Center of the Criminal Investigation Bureau or directly Financial Oversight Committee Used in financial fraud cases. You can use the Anti-Fraud Hotline 165 to report fraud crimes.
These resources give victims the ability to act quickly while assisting law enforcement and regulators in effectively combating crypto fraud. By submitting detailed reports, you can participate in the transaction to track illegal transactions and assist in recovering funds where possible.
Lessons and advice
law enforcement
- Improve the level of blockchain through dedicated training programs to effectively investigate and prosecute cryptocurrency-related crimes.
- Develop standardized protocols and best practices to simplify the processing, reporting and recovery of digital assets related to criminal activities.
For victims of crypto scams
- It is crucial to act immediately. The victim should report the incident to the authorities and use Bitquery Investigation Team Track hacker addresses, transaction hashings and other important details.
- Providing a complete investigation report to law enforcement can significantly improve the chances of fund recovery.
- Participate in legal experts who are proficient in encryption to deal with the complexity of international and local regulations.
- Exercise patience and durability throughout the recovery process, as these situations usually take time to resolve.
