Cryptocurrency related scams are out of control. In just 2024 year-to-date, criminals have made off with an estimated $2.2 billion, representing a jaw-dropping 21% increase over last year. Even with tremendous work from law enforcement and the nonprofit blockchain investigative community, only a small percentage of victims ever see their money returned. Today’s increase in advanced scams reminds us that constant awareness and proactive security development is required in the crypto world.

Investment frauds, not surprising given the insidious, but increasingly prevalent “pig butchering” schemes, make up around 71% of all crypto-targeted losses. Scammers typically gain victims’ trust first by engaging them before persuading them to invest in phony crypto trading platforms. This has been especially catastrophic to older adults here in the US, with reported elder financial abuse losses of over $2.8 billion.

Although the odds are definitely not in the victims’ favor, there are many stories of successful recoveries. Just to the north, the US Department of Justice (DOJ) has been taking victory laps after recovering $3.6 billion from the 2016 Bitfinex hack. This seizure is now the largest ever in crypto history. Blockchain sleuths such as ZachXBT have cut their teeth with incredible success, recovering more than $210 million through public forensic funded research. One California prosecutor even managed to recover around 70% of the victims’ losses in a pig-butcher case, recouping $210,000 from $300,000 stolen.

There are a number of tools and strategies that can help speed and shape the recovery in a better direction. On-chain tracing software, such as those offered by Chainalysis and TRM, allows investigators to map the flow of stolen cryptocurrency, potentially leading to the identification of culprits and fund recovery.

There are steps people can take to mitigate their risk. Whether by revoking their smart contract permissions directly via tools such as Etherscan or Revoke, they mitigate the potential damage caused from compromised contracts. Regularly update your passwords, and use different credentials for different sites to improve your account security. Adopting app-based two-factor authentication brings a new level of security. Zero-trust strategies like verifying who you’re communicating with and the address of any smart contracts add an extra layer of protection from scams.

Victims of cryptocurrency scams should report the incidents to relevant authorities. In the US, you can report crypto scams to federal agencies including the IC3 (FBI), FinCEN, FTC. These federal organizations stand prepared to assist you as you fight fraud. Internationally, INTERPOL or Europol’s I-GRIP mechanisms offer ways to report and investigate. California’s Department of Financial Protection and Innovation (DFPI) keeps a publicly available crypto scam tracker to discourage and track crypto scams.