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The US Secret Service has quietly accumulated nearly $400 million in seized cryptocurrency, creating one of the largest cold wallets globally through meticulous blockchain investigations.
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Utilizing advanced blockchain analysis and tracking VPN errors, the agency has successfully unraveled complex crypto scams, exposing fraudsters worldwide.
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Jamie Lam, a lead investigative analyst, emphasized that scammers often use fake identities to lure victims, highlighting the sophisticated social engineering behind these schemes.
US Secret Service amasses $400M in crypto cold wallets by exposing scams via blockchain tracking and VPN slip-ups, highlighting rising crypto fraud and law enforcement efforts.
Blockchain Analysis: The Key to Unmasking Crypto Fraud
The US Secret Service’s Global Investigative Operations Center (GIOC) has leveraged blockchain forensics and open-source intelligence to trace illicit funds with remarkable precision. By following transaction trails and analyzing domain records, investigators have penetrated the opaque world of crypto scams. A critical breakthrough often comes from simple operational mistakes by criminals, such as VPN failures that reveal IP addresses, enabling law enforcement to map out fraudulent networks. This methodical approach has allowed the agency to consolidate seized assets into a single cold wallet, representing a significant recovery from multiple scams.
Training and International Collaboration Enhance Enforcement
Under the leadership of Kali Smith, the Secret Service has expanded its crypto crime-fighting capabilities by training officials in over 60 countries. These sessions focus on identifying vulnerabilities in jurisdictions with lax regulatory frameworks or residency-for-sale programs, which scammers exploit. Smith notes that many countries are initially unaware of the extent of crypto fraud within their borders until after targeted training. This global cooperation has been instrumental in dismantling schemes ranging from romance scams to sextortion, showcasing the agency’s commitment to international financial security.
Crypto Scams Drive Record Internet Crime Losses in the US
According to FBI data, crypto-related fraud has surged to become the leading cause of internet crime losses in the United States. In 2024 alone, Americans reported losses of $9.3 billion due to crypto scams, accounting for over half of the $16.6 billion total internet crime losses. The trend continues into 2025, with reported losses exceeding $2.47 billion in just the first half of the year, marking a near 3% increase from the previous year. These figures underscore the growing sophistication and prevalence of crypto fraud, emphasizing the need for vigilant enforcement and public awareness.
Industry Cooperation Key to Recovering Stolen Funds
Recovering stolen cryptocurrency often hinges on collaboration between law enforcement and industry players. Major platforms like Coinbase and Tether have played pivotal roles by analyzing suspicious transactions and freezing wallets linked to scams. Notably, one of the largest recoveries involved $225 million in USDt connected to romance scams, demonstrating the impact of coordinated efforts. This partnership model is crucial for disrupting criminal operations and returning assets to victims, reinforcing the importance of public-private cooperation in combating crypto crime.
Conclusion
The US Secret Service’s strategic use of blockchain analytics and international training initiatives has positioned it at the forefront of combating crypto fraud. By quietly amassing a substantial cold wallet from seized assets, the agency not only disrupts criminal enterprises but also sets a precedent for global financial security efforts. As crypto scams continue to drive significant internet crime losses, sustained collaboration between law enforcement and industry stakeholders remains essential to protect investors and uphold trust in digital assets.
