The use of cryptocurrency is increasing, and crypto crime is rising with it. In fact, fraudsters, malicious hackers, and thieves amassed $1.36 billion in stolen crypto in the first half of 2020 alone.
According to blockchain analysis firm Coinfirm, there is as much as $10 billion in stolen crypto on the market. But not all lost crypto is stolen – you can lose a phone or wallet containing cryptocurrency, much like you could lose anything, for example, your own physical wallet.
Whether stolen or lost, it may be possible to trace and recover crypto funds.
It is crucial to act as quickly as possible if you have been a victim of crypto crime. The longer you wait to begin tracing your crypto, the more time thieves have to obfuscate the crypto assets – such as placing the funds into a mixer/tumbler or transferring them to cold storage.
With a strong case in hand, you can begin to freeze your assets. An international freezing order issued by the High Court against the wallet associated with the crypto assets will help prevent the funds from moving any further.
The legal system can help you in these situations. Thanks to the transparency of the Blockchain, which acts as a ledger for all transactions, it is easy to see where stolen funds go. If the funds go to a service such as an Exchange or Vendor, it is possible with the right investigations and legal team to identify who is in control of the wallet. A court order can then be granted to reveal the thief’s identity and recover the stolen funds.
The best way to avoid being a victim of crypto crime.
To begin, do your due diligence. If someone has approached you with an investment opportunity, conduct research into the individual and the company they represent. The Financial Conduct Authority (FCA) records are a good place to begin. From here, you can discern whether the investor or company is registered or if they are on any warning lists. Other publicly available information like social media helps you determine the credibility of who you are engaging with. Specialist investigators with additional resources can give you more peace of mind to supplement the research you have done.
Protecting your cryptocurrency means protecting yourself and your investments. The right security software will reduce the risk you face of leaving yourself vulnerable to malicious scams or phishing schemes.
Also, consider dividing your assets into ‘cold’ and ‘hot’ storage. The cold storage remains protected by being disconnected from any internet connectivity, unless carrying out transactions. The best practice would be to hold the majority of your funds in cold storage to prevent any hackers from obtaining these assets. Hot storage are online wallets used for normal transactions and only contain the funds you need for that moment.
Private keys give access to your wallets. Make sure that your private keys are secured at all times and do not give these out to any other persons.
Specialist investigators from AnotherDay hold accreditations on the Chainalysis Reactor platform. This platform was used to trace $1 billion in crypto that was seized from the silk road.
Our cybersecurity specialists can review your online security to see where any vulnerabilities lie. Once that is completed, we help you create a secure environment for your cryptocurrency. From the tools you need to use, to the processes and policies that ensure robust security.
If you have been the victim of cryptocurrency crime, our in-house capability to investigate, trace, and analyse the movement of cryptoassets means we can give you the best chance at recovering them. We use specialist tools to identify how the funds are moving before determining where, when, and how much of the stolen funds are being used.
We then gather traditional evidence such as witness statements, documentary evidence, an analytical review of blockchain transactions, and open-source intelligence to bring together a comprehensive ‘evidential package’, which can be used to take action through civil or criminal remedies.
Marlon leads the investigations team at AnotherDay. A former detective from the Flying Squad, an elite unit from New Scotland Yard in London. His main work involves assisting companies in relation to a wide variety of crime and investigation advisory to support internal problems.
Marlon has a wealth of experience in conducting complex criminal and civil investigations and is an expert in covert surveillance methodologies; having been trained to the highest level in the UK, and regularly uses this expertise in his investigations.
Additionally, Marlon is seen as an expert in cryptocurrency investigations after being mentioned in the judgement in the landmark case of ‘Duncan Johns and Ion Science v Persons unknown’.