Have you fallen victim to a crypto scam and are wondering how to get Bitcoin back from scammers? Our expert guide offers actionable steps to improve your chances of successfully tracing lost or stolen digital assets. Read on to empower yourself in the fight against crypto fraud.
The digital asset space has attracted online criminals like a flame draws a moth. Wherever there is money, scammers are never far behind. And when the opportunity exists to move value around anonymously or pseudo-anonymously, the temptation is even greater.
As the crypto market fluctuates through its cycles, crypto scams tend to multiply whenever the price of cryptocurrencies skyrockets. Your digital assets aren’t safe from scams and fraud attempts during bear markets either.
According to the FTC, in 2021, crypto losses to fraud amounted to more than $680 million. Since then, this number has been left in the dust. If you have lost money to crypto theft, scams, or fraud, you are far from being alone.
The scams of the Web3 age are numerous, and new ones come online all the time. From romance scams to fake influencers, investment schemes, and phishing, danger is everywhere.
Hackers can tap into hardware wallets provided the owners have not bought them directly from the manufacturer. They can convince wallet owners to give away their seed phrases through trickery and deceit.
The semi-transparent nature of blockchain technology allows for the tracing of the stolen funds to some degree. Navigating the complexities of asset tracing and identification is a unique domain within the crypto industry, which itself is subject to a myriad of regulations that vary from country to country. Crypto crimes are inherently international, complicating the process further. Effective assistance in asset tracing cases demands specialized skills, such as legal expertise and the ability to liaise with local law enforcement agencies.
Here’s what you can do if you have lost your digital assets to a scam.
How to Get Bitcoin Back from Scammers, Step 1: The Starting Point
Most blockchains keep a record of all transactions that take place on them. They attach a code made up of letters and numbers to every transaction so they can identify them later. The Bitcoin blockchain uses a 65-digit hexadecimal number to identify its transactions.
Your first step is to find the ID of the transaction you or the scammers used to steal your digital assets. The ID(s) can help investigators trace the path of the stolen funds through the blockchain and eventually identify their destinations.
To locate the transaction IDs, you need to use a blockchain explorer. The wallet you use may support one or link to one directly from the transaction section. While exchanges and wallets don’t always provide the transaction ID, you should be able to find it using a blockchain explorer.
Once you open the Explorer, look for the date, time, and the amount you sent. Ensure that you locate the right transaction and look for its hash.
How to Get Bitcoin Back from Scammers, Step 2: Building Your Case
Transaction IDs represent the foundation upon which you can build your case. You can help investigators further by fleshing out the story of the fraud with details. Here’s what can further assist specialists in asset tracing and identification to support your case for fund recovery:
- Details about the interactions you had with scammers, with screenshots if possible.
- Screenshots of the Twitter posts, messages, and emails you have exchanged with the scammers.
- The accounts where you believed you were sending the funds that ended up stolen.
- Any other information of any significance you can dig up about the scammers.
How to Get Bitcoin Back from Scammers, Step 3: Establishing Your Ownership of the Assets You Aim to Trace and Identify
Once you have created a detailed presentation of your case, prepare to prove that the assets you sent the scammers were, indeed, yours. Investigators need such proof, as they can’t afford to invest time and resources into someone’s fraud attempt. Unless you can prove ownership of the assets, you have no basis for seeking assistance in tracing and identifying them. Attempting to do so without ownership would be equivalent to theft.
How do you prove ownership in the (pseudo)anonymous world of crypto? If you still have access to the wallet you used to send the scammers your funds, you can use it to send a microtransaction to a predefined address.
How to Get Bitcoin Back from Scammers, Step 4: Getting in Touch with the Relevant Authorities
In addition to contacting a tracing and investigation company like CNC Intelligence, victims of scams should always report the incident to the authorities. The relevant authority depends on the jurisdiction where you reside.
- If you’re in the US, you can contact the FBI’s specialized department that deals with cybercrime or the Federal Trade Commission.
- In Japan, report the incident to your local police department.
- In Canada, you can report the theft of digital assets online to the Canadian Anti-fraud Centre.
- In Australia, the Criminal Intelligence Commission is the authority to which you can report cybercriminal activities.
- Dubai maintains a dedicated website for the reporting of online crime, the eCrime site.
- Colombia doesn’t offer a formal method to report digital asset theft. You can, however, turn to the local Unidad de Información y Analisis Financiero.
- In Singapore, the National Crime Prevention Council maintains a portal where you can post scam alerts.
- If you reside in the EU, Europol’s cybercrime reporting page is the quickest and easiest way to report online criminal activities.
- In Brazil, going to your local police station is the most straightforward option. You can also report digital asset theft online at the Civil Police’s dedicated portal.
Will You Get Your Funds Back?
Provided you move quickly and provide relevant information to the authorities and your crypto theft investigation firm, you may get your assets back. You should be aware that sometimes tracing and identifying stolen assets across international borders may not result in successful fund recovery. Some jurisdictions may choose not to cooperate, or the criminals may be able to obfuscate the trail of the funds they have stolen from you.
If the asset tracing and identification process is successful, it will require time. Additionally, you may not be able to recover the full amount of lost funds.
The challenges of crypto asset recovery are many. US authorities are well aware of these challenges, as a recent report of the DoJ reveals.
Those looking to recover stolen digital assets face some of these problems:
- Some of US law enforcement’s foreign partners do not have the tools to combat cybercrime.
- In addition to technical means and know-how, foreign law enforcement agencies may also lack the willingness to assist US investigators.
- Collecting evidence in a timely manner is difficult, given the speed and cross-border nature of cryptocurrency transfers.
- Effective recovery action depends on smooth information sharing among the authorities of several countries.
The 2013 case of Liberty Reserve is only one example of a series of successful tracing and recovery efforts US authorities undertook in cooperation with foreign law enforcement agencies.
The IRS specialized branch cooperated with Costa Rica’s AML authorities, as well as the financial authorities of several other countries to wrap up a multi-million dollar global money laundering scheme. The investigation resulted in law enforcement actions in 16 countries.
How to Get Bitcoin Back from Scammers: Conclusion
Thanks for reading our article on how to get Bitcoin back from scammers.
Remember, nothing is guaranteed when it comes to tracing and identifying digital assets. However, by following the steps outlined in this guide, you can significantly improve the likelihood of a successful outcome in your asset tracing case.
Stay informed, and do not buy into suspicious schemes. If you don’t lose it, you won’t have to worry about how to get Bitcoin back from scammers.
We offer complimentary consultations to determine if our Asset Tracing, Recovery Assistance, and Intelligence Services suit your case.
- Digital Assets: A digital asset is any text or media that is formatted into a binary source and includes the right to use it; in your context, it mostly refers to cryptocurrencies like Bitcoin, Ethereum, etc.
- Web3: Refers to a new paradigm for applications on the internet that involves decentralized protocols and technologies, including blockchain.
- Hardware Wallets: Physical devices that store a user’s private keys securely, used for storing cryptocurrencies.
- Seed Phrases: A series of words that store all the information needed to recover a Bitcoin wallet. Also used for other cryptocurrencies.
- Blockchain: A digital ledger where transactions are recorded chronologically and publicly, often utilized by cryptocurrencies.
- Hexadecimal Number: A base-16 number system that uses sixteen distinct symbols. In the context of Bitcoin transactions, it refers to the unique identifier for transactions.
- Transaction ID: A unique string of letters and numbers that identify each transaction made on a blockchain. Sometimes referred to as the ‘hash.’
- Blockchain Explorer: An online tool that allows users to browse blocks, addresses, and transactions on the blockchain.
- AML: Anti-Money Laundering, refers to a set of procedures, laws, or regulations designed to stop the illegal practice of generating income through actions like money laundering.
- Pseudo-anonymous: In the context of cryptocurrencies, it means that while transactions are public, they are not directly linked to identities unless extra information is provided.