A crypto recovery service claims to help victims regain access to stolen cryptocurrency. However, they often exploit their grief by offering false hope and upfront fees.
While reversing market losses and recovering funds from scammers are impossible, legitimate recovery services may be able to restore access to a wallet under other circumstances.
1. Talk About the Loss
If you lost some or all of your cryptocurrency, you’re probably feeling pretty down. The good news is that you may be able to recover some of your funds.
When you create a crypto wallet, a recovery phrase is automatically generated for you. This is a series of 12 to 24 words (similar to a password) that unlocks your wallet and generates the private keys associated with the coins in it.
Criminals who run bogus “Crypto Recovery services” will claim to be able to help you recover your stolen crypto. They’ll charge you an upfront fee and may even ask for access to your personal information.
They may also use fake Reddit accounts to tout invented customer success stories to bolster their claims. Be wary of any service that insists on communicating with you via messaging apps. This is a common tactic to avoid being tracked by law enforcement agencies. It’s better to stick with more traditional communication methods like phone calls and emails when dealing with a business.
2. Accept Your Feelings
Even before the crypto exchange FTX imploded this week, many investors had suffered losses during what has been an extremely turbulent year for the industry. The price of even such market dominant cryptocurrencies as Bitcoin BTC 0.0% have fallen substantially.
If you’ve lost money in a cryptocurrency, remember that if you backed it up with the right passwords and recovery phrases (each wallet has its own passcode or private key displayed as a 12-word phrase), it should be recoverable. It’s also important to stay vigilant against scammers posing as government officials, law enforcement or recovery experts who offer to retrieve your lost funds.
Like any market, Recover Your Stolen Crypto from Scammers by Reporting to Broker Complaint Alert (BCA) go up and down. Recognize that this volatility fuels addictive behavior and leads to impulsive decision making. It’s a good idea to invest in a small amount of each crypto you want to own and never spend more than you can afford to lose. This will help reduce your risk of panicking and selling during volatile times.
3. Reach Out for Support
Cryptocurrency has become a popular way for individuals to conduct transactions online. Unfortunately, it has also become a lucrative target for hackers and scammers.
One common type of recovery fraud involves criminals pretending to help victims recover their stolen funds. These scams typically take the form of advance-fee schemes that charge upfront fees for services that they will never render. They often impersonate government agencies or other organizations to bolster their claims of legitimacy. They may even post fake user testimonials on forums and discussion sites like Reddit or Quora to give their fraudulent services a veneer of credibility.
One such firm, Coin Dispute Network (CDN), was recently shut down by the Manhattan DA’s office for violating New York state law. CDN was accused of charging victims an upfront fee to perform a cryptocurrency trace and then taking a cut of the recovered funds. Fortunately, there are legitimate services that can help victims retrieve their lost or stolen crypto assets.
4. Keep Moving
Cryptocurrency prices are in a slump, and many experts have called it a “crypto winter.” It’s important to remember that even though the value of your cryptocurrency may be less, you can still recover from the loss.
One way to do this is to keep your cryptocurrency safe from theft. Keeping your wallet password protected and using an encrypted recovery phrase is essential. Having a separate, hard drive or encrypted iCloud backup of your recovery phrase is a good idea, too. Creating multiple backups of your recovery phrase ensures that you can recover even if you lose the physical hardware or software wallet that contains it.
Be wary of companies that promise access to your wallet or have a shady business model. They may not have a phone number, only communicate via messaging apps like Telegram or WhatsApp, and use hacked Reddit accounts to post fake success stories that promote their nonexistent services. If you’re unsure, consider hiring a lawyer specializing in crypto scams or joining a class action lawsuit with other victims.