We have observed a significant increase in crypto exploits over the last year, with a record-breaking $3.7 billion worth of crypto stolen only in 2022. We understand this situation can be stressful if you have personally experienced such malicious activity.

However, we want to caution you about recovery asset scammers and provide you with an honest understanding of how the recovery of stolen crypto funds works. It is crucial to know what to expect, how private investigators could assist you based on where you are based and your case (and, most importantly, what they cannot do), and how to protect yourself from scammers.

Disclaimer: The information provided on this page does not, and is not intended to, constitute legal advice; all information, content, and materials available on this website are for general informational purposes only.

For immediate advice on protecting yourself from further harm, such as blackmail, ransomware, theft, or hacking, we recommend reading our dedicated series:

Now, let's delve into how the recovery of stolen crypto funds typically operates.

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1- Understanding the Recovery Process:

If you have fallen victim to malicious crypto activity, it is likely that your stolen funds are now either held in a scammer’s wallet on the blockchain or the scammers have tried to convert your funds into fiat currency. Scammers often transfer funds across various wallets to complicate tracing them. Your funds need to be traced, located and ultimately seized to recover your funds.

Time is a crucial parameter here: there is a race against the clock to locate stolen funds before the scammer converts them. Thus, it is key to report your case as soon as possible. If there has been significant time (e.g., several months) between the loss event and the time you are considering reporting your case, the money can certainly not be recalled.

There are two ways this recovery process can unfold:

A/ Primary - Through Law Enforcement investigations:

Law enforcement is the best and most frequent way for victims to recover funds, based on access to tools, seizure authorities, volumes of additional fraud reports, and connections with common cash-out points such as exchanges.

Phase 1: You report your case to your local, regional, or national Law Enforcement agency. You can find information on where to report based on location and what to include in your report to Law Enforcement by visiting our dedicated page. Please report your case as soon as possible, ideally on the same day.
Phase 2: Law Enforcement takes on the case. Please note that Law Enforcement may be unable to take on the case because of a lack of evidence, the time since the scam occurred (Law Enforcement is more likely to investigate very recent scams, as the seizure is more likely), and the inability to identify several victims. In some specific jurisdictions, Law Enforcement receives way more cases than they can investigate and only takes on cases above a certain threshold or when multiple victims can be identified.
Phase 3: IF Phase 2 is true, then Law Enforcement investigates your case, tries to trace the funds on the blockchain, and tries to identify their current location and can do so.
Phase 4: Law Enforcement issues a freezing order to the platform holding the stolen crypto funds. It's important to note that only Law Enforcement can issue such an order. Phase 4 can also include a legal phase, where the case is taken into court based on the jurisdiction.
Phase 5: The funds are frozen and returned to you.

However, it's essential to understand that even if Law Enforcement takes on a case, there is no guarantee that they can recover the funds. Several factors influence the success of recovery, including the techniques used by the scammers to obfuscate the funds, jurisdictional differences in how digital assets are classified, and the nature of the platform where the funds are currently held.

B/ Minority of cases - Through civil litigation, at extra costs.

Please read our dedicated page here to learn how to report to Law Enforcement based on your location and what to include in your report.

To learn more about how to report to Law Enforcement based on your location and what to include in your report, please read our dedicated page here.

2- Private Investigators' Role in Fund Recovery.

Private investigators may assist victims in recovering stolen funds through various methods. Here are the options available. Please note that it is optional and often not recommended based on the case. For example, in case of romance of pig bucthering scams, it is unlikely private investigators would be able to help you.

What follows is not required nor a pre-requisite to report your case to Law Enforcement. You can always report your case to Law Enforcement for free.

To learn more about how to report to Law Enforcement based on your location and what to include in your report, please read our dedicated page here.

A. Conduct initial tracing of funds (cost: $0-$800).

Goal: identify if there are any recovery options (or not), include more information in the report to Law Enforcement, and understand what may have happened. This is not a prerequisite to filing a report with law enforcement. You can always file a report to Law Enforcement for free.
Consists of: Initial tracing of stolen funds on the blockchain. It involves identifying transaction addresses and providing insights.
How much does it cost? Depending on the complexity of the case and the private investigative firm, the cost ranges from $0 to $800. There is as always, no guarantee of recovery.
Only works well if: you lost a significant amount and you want to understand what happened to your funds even if you cannot recover them, and local law enforcement is open to leveraging insights from private investigators. Please note that even if the private investigator manages to trace your funds, there is no guarantee and it is unlikely those will be recovered.
Does not work well when: You hope to use the information within your law enforcement report but law enforcement does not consider insights from private investigators, or the lost amount doesn't justify the cost of a consultation.

B. Perform full civil litigations

Goal: Recover funds through civil litigation.
Consists of: Private investigators and lawyers conducting full civil litigation, with costs borne by the victim upfront.
Cost: Depending on the case's complexity, costs range from tens of thousands to millions of dollars.
Does not work well when: Law Enforcement can support your case, the lost amount doesn't justify the upfront costs, or recovery seems unlikely based on initial tracing (option A).
Works well when: Local law enforcement lacks capacity, initial tracing indicates high and possible recovery, and the lost amount justifies the investment in civil litigation (e.g., several millions of amounts lost). Even then, there is never a guarantee funds can be recovered.

C. Perform full civil litigations, helping the victim find third-party litigators:

Goal: Recover funds with the assistance of third-party litigation funders.
Consists of: Private investigators and lawyers conducting full civil litigation, with costs covered by third-party litigation funders (taking a percentage of recovered funds, typically 30-40%).
Cost: The victim doesn't pay upfront, but there's no guarantee of recovery.
Does not work well when: Law enforcement can already support your case, no third-party litigation funder is available (e.g., total amount lost does not reach several millions of dollars), or recovery seems unlikely based on initial tracing.
Works well when: Local law enforcement cannot support the case, third-party litigation funders are available - typically means at least several millions of amounts lost - and initial tracing suggests potential recovery of an extremely significant amount. Even then, there is never a guarantee funds can be recovered.

D. Set up a class action:

Goal: Launch a group action to recover funds.
Consists of: identifying a group of victims of the same scam, whose total amount lost reaches several millions of dollars, analyzing the blockchain and databases to determine viability, with costs covered by third-party litigation funders (taking a percentage of recovered funds).
Cost: Covered by third-party litigation funders (taking a percentage of recovered funds, typically 30-40%), but there's no guarantee of recovery.
Does not work well when: No other victims can be identified, or total losses are insufficient, Law Enforcement can already support the case, or recovery seems unlikely based on initial tracing.
Works well when: Local law enforcement cannot support the case, multiple victims can be identified, and the total losses justify a group action.

3- Beware of Asset Recovery Scammers

Be cautious! Many illegitimate recovery entities are in the ecosystem. Some are reputable, and some are trying to exploit vulnerable victims.

Indeed, some untrustworthy investigative firms may try to exploit victims' vulnerable situations by offering false promises of helping them recover their funds. They often claim to be able to trace and recover funds by contacting the platform where the funds are located or having “relationships” with law enforcement.

However, this is often a scam. Platforms are overwhelmed with requests and cannot respond to all inquiries. In most countries, only law enforcement can issue a freezing order to any platform.

On top of that, many private investigative firms may not use edge-cutting tools and produce law-quality investigations that contain errors and cannot be used by law enforcement.

4- How can you protect yourself from Asset Recovery Scammers

To safeguard yourself from asset recovery scammers, follow these guidelines:

Only Law Enforcement can issue a freezing order to any platform, so do not respond to investigative firms claiming they can freeze funds on your behalf.
Refrain from providing personal information to unknown investigators.
Do not automatically trust organizations solely based on positive reviews, as these reviews can be fabricated.
Be cautious of any firm that guarantees the return of your funds, as this is likely a scam. Remember that funds recovery can never be guaranteed.
Only leverage high-quality, pre-vetted investigative firms that use edge-cutting tools. And even know, please always step back on whether it is worth it given the costs involved and the low likelihood of recovering funds.
When considering hiring a lawyer or investigator, be sure to ask at the beginning how, even if they can trace the funds, the investigator will help the victim recover funds. If the answer is related to providing your information to law enforcement, which victims can do individually, ask them how that will differentiate your complaint from their individual complaint. Hiring a private investigator is never a pre-requisite to file a report with Law Enforcement.

5- Can Chainabuse provide private investigations on my case?

Chainabuse does not directly provide private investigation services and does not provide any commercial services to victims. Instead, we offer the following free advice and support to every victim who opts in:

We provide free advice to victims based on their cases. To receive advice, simply report your case here and opt-in for support at the bottom of the form "contact and support". You will then receive an email from support@chainabuse.com. Please read it attentively.
We analyze reports from our platform to connect victims of the same scam, aiding Law Enforcement in identifying larger cases to increase chances that funds from multiple victims can be recovered.
We collaborate with Law Enforcement worldwide to expedite lead generation and investigations.

Chainabuse is not a replacement for any Law Enforcement reporting platform. We encourage every victim to report their case to Law Enforcement and offer free advice. You can find information on where to report based on location and what to include in your report to Law Enforcement by visiting our dedicated page.

6- Recommendations for Private Investigators

If you seek private investigative support and want to avoid asset recovery scammers, we can recommend legitimate private investigative firms with a good reputation. Please note that Chainabuse does not receive any revenue for referrals, does not offer commercial services to victims, and these firms may offer various investigative services. To learn more, please read our dedicated article here.

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If you have further questions regarding the information above, please contact us at hello@chainabuse.com.

When you report your case on Chainabuse here, it will be assessed at no cost to determine if other victims can be identified, which increases the likelihood of Law Enforcement taking on the case or setting up class actions.

For additional questions, please refer to our FAQ here. If your query remains unanswered, feel free to reach out to support@chainabuse.com.

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Understanding the recovery of stolen crypto funds and how to avoid asset recovery scammers