My Adventures as a Crypto Bounty Hunter: Undercover Edition

I'm returning to my crypto bounty hunter series featuring today the undercover edition. I'm a crypto bounty hunter and today I’ll share a recent encounter I have had with a scammer.

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Cross-Chain Man

While working on behalf of a client, I encountered a scammer who had stolen around 79.5 ether on Christmas time. The stolen funds were split into two transactions and sent to a Hybrid exchange (which I will not name for obvious reasons) to be swapped for another coin or token.

The problem is that these exchanges basically work like a CEX (centralized exchange) in the sense that you can swap "any" token or coin for any token or coin without having to use a bridge but are decentralized. As a result, there are no records of the transactions. The transaction still happens on both sides, but you cannot "link" them. Scammers often use these exchanges to launder funds because records are hard to find.

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I first tried to find all transactions on the Ethereum side, where the scammer deposited the stolen funds, and correlated them with withdrawals on other chains (BTC, BNB, PHANTOM) to see if I could find a matching transaction to trace the funds on the other side. However, there were thousands of transactions and I found it time-consuming. Don't mistake me, I could have found out where the funds went that way, but it would have taken a lot of hours which I do not have at the moment.

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While brainstorming for solutions, I realized that hybrid exchanges have customer support and had the idea to contact them pretending to be the scammer and say that I had not received the transaction on the other side. I had the initial wallet address, the transaction hash, the amount that was swapped, and the date, but I was missing one factor: the coin or token that the Ethereum was swapped for. So, while speaking to them via chat, I took a guess and pretended I had not received my BTC (I took this shot based on experience, I guess?). And guess what? They gave me the transaction hashes!

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I was able to trace the funds to several known exchanges, including Coinbase and Binance, as well as some in Eastern Europe.

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Unfortunately, there is no happy ending yet as we have just entered the process of contacting the exchanges, but I am positive on this one and that is why I am sharing the story. If you would like, I can provide updates in the future.

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Please let me know if you wish me to continue this series.

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As always Stay safe and Freak the Scammers