In a 2019 analysis on cryptocurrencies by Kaspersky, roughly 19% of survey participants claimed they had been victims of exchange hacks and another 15% claimed they had lost cryptocurrency.
This implies that if you own Bitcoin or any other digital currency, cybercriminals are interested in your savings. However, if the worst occurs, is it feasible to reclaim stolen cryptocurrency?
When someone has your digital wallet’s private keys, it’s typically impossible to recover stolen cryptocurrency or bitcoin. One-way transactions are the intended use of digital assets. The same level of security applies to legitimate and unauthorized transactions involving stolen money. Future theft can be avoided with secure procedures.
But hold onto your hope. This manual will give you advice on what to do if you end up a victim of fraud as well as how to avoid it in the future.
Why It’s Difficult to Recover Stolen Bitcoin and Other Cryptos
It is highly unlikely that you will be able to get your stolen virtual money back. Theoretically, you can track your stolen cryptocurrency by looking at the blockchain, but in practice, this is challenging because to the anonymity of the system and the likelihood that the thief would use a bitcoin exchange to convert the currency to fiat right away.
Yes, the majority of transactions leave a trace that you may be able to follow to identify the perpetrator. However, because the majority of cryptocurrencies are decentralized, there are few possibilities for retrieving the money even if you are successful in tracing the information through public ledgers.
Identify if recovery is worthwhile
It is wise to think carefully before going that route because trying to recover is typically very expensive and emotionally taxing. Whether it’s worthwhile to spend the time and money on a professional recovery or to just let it go and pay the tuition for learning how to handle and retain cryptocurrency properly depends on the individual. This is especially true if you haven’t invested an excessive amount of your investable assets in this asset category.
The advice provided here can assist you in finding your missing cryptocurrency.
Use Crypto Recovery Service
If you are willing to pay a fair amount to get your money back, there are websites where you can post a bounty. The theft will be investigated by knowledgeable blockchain searchers, who will then decide if the coins can be retrieved for a fee. A great place to start is Bitcoin Bounty Hunter and other websites of a similar nature. These services, though, can be pricey, and they typically just provide information that is already available to the public.
Additional Steps You Can Take to Attempt to Recover Your Stolen Cryptocurrency
Speak With the Police
Having a case number or papers isn’t a terrible idea, even though a formal complaint is unlikely to help in the recovery of stolen cryptocurrency. You never know if you’ll be a part of a lawsuit or an insurance settlement. Having evidence that you took the loss seriously can be helpful if you need to support your claim.
Please Inform the Cryptocurrency Exchange
You must act quickly if you discover that your cryptocurrency has been taken, perhaps as a result of an attempt to hack into your account. In order to hide their tracks, hackers may be able to move your money to a cold wallet before sending it to other exchanges if the tracing process is delayed.
Observe the Money
Transactions on blockchains leave a trace that may be followed. Additionally, locating the thief’s wallet address is not too difficult.
You can monitor the wallet address where your funds were transmitted and the transactions made with them. Inform the cryptocurrency exchange right away if the fraudster tries to transfer money from the account to an exchange.
Before exchanging cryptocurrency for fiat money or engaging in trading, traders on most exchanges are required to provide KYC (Know Your Customer) information, such as names and addresses. The site can assist in finding the con artist if you report the situation. This is yet another factor supporting the significance of a police report.
Dial the Helpline
If your exchange is more significant and well-known, you have a higher chance of getting help. Depending on the stage or level of the theft, the exchange may be able to freeze your money if you move soon.
Though many exchangers aren’t required to help, keep that in mind. Some exchanges are located in countries with little limitations on cryptocurrency. Additionally, several countries do not view cryptocurrencies as assets, which reduces the likelihood of receiving official support.