The American crypto exchange Coinbase helped law enforcement authorities seize millions worth of digital assets that were stolen through pig butchering scams.
Beginning in 2023, the stablecoin issuer Tether froze 39 wallets with $225 million in USDT that were tied to pig butchering scams – deceptive schemes in which bad actors typically initiate fake romantic or business relationships with victims to financially exploit them.
The U.S. Secret Service (USSS) traced the frozen funds to 140 accounts at the crypto exchange OKX. Many of these wallets are under the name of individuals who were trafficked into scam compounds in Southeast Asia.
In February 2024, Coinbase team members joined the Secret Service investigation, working with USSS agents to trace crypto transactions and analyze account activities to flag victims.
The exchange says the blockchain analysis and subpoena records production enabled the USSS to identify more than 130 Coinbase customers who were defrauded out of a total of $2.3 million.
“Coinbase played a key role in this landmark operation, supporting the investigation, tracing on-chain funds, and helping identify victims eligible for restitution.”
Coinbase says the USSS has already taken control of the $225 million in USDT and is now in the process of returning the stolen funds. The exchange says the victims must provide proof that they sent funds to the scam-related wallets by downloading their transaction history from their crypto platform.
“Many victims used Coinbase, and we’re already seeing an increase in customer support inquiries related to account access and transaction records.”
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