Crypto markets have always seen users lose cryptocurrency due to various reasons, including hacks and self-inflicted losses. In some cases, recovery is easy, while in others, it becomes almost impossible.
In this article, we guide you through the common steps that may be helpful if you have lost your crypto for any reason.
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Damage Assessment
The first task after you discover lost crypto is to assess the damage across all your wallets and CEX accounts. It is highly likely that a hack might have taken place across multiple accounts, platforms, or wallets at once.
This happens because when the hacker figures out a loophole in the blockchain or wallet dApp, they scramble to find other potential wallets with the same vulnerability.
Therefore, without being panic-stricken, it is best to assess the damage first, even if it means taking some time before you jump into any action. Doing so may help you discover the extent of damage and seek appropriate help.
Safeguard Remaining Assets
Now that you have assessed your damage, it is necessary to safeguard all your assets. You can do so by transferring them to new wallets or CEX wallets.
If you are undertaking self-custody, it is advisable to create new wallets. If you do not want to create multiple wallets for all assets, maybe try to bridge your assets to a single chain like BNB that offers the highest support for pegged assets.
Otherwise, it is best to transfer the assets to a centralized exchange wallet (CEX). This way, you can figure out later about the best course of action.
Track Transfer via Blockchain Explorers
The first thing you can do after securing your remaining assets is to track where and when they have been transferred. Also, note the amounts of transfers and, if possible, try making a spreadsheet.
This information would be critical when you file a complaint with the law enforcement of your country. For law enforcement to compile the same data, it would often take days as they have to gather all the necessary permissions and experts.
Therefore, making a spreadsheet or any digital document could be critical in fast-tracking your complaint with the law enforcement of your country, region, or city.
File a Complaint
Filing a complaint is a necessity since you do not have the power to track and freeze the accounts held by the hacker.
Further, by filing a complaint, you can set things in motion while doing your own parallel investigation. Please note that a parallel investigation should not interfere with any police investigation; otherwise, you may suffer consequences, directly or indirectly.
However, before filing a complaint, ensure that you are reaching out to the right agency. To find the right and competent agency in your country, search for the nodal crypto crime investigation agency with your country’s name on Google.
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Hire a Crypto Investigator
A crypto investigator can help you run your parallel investigations. Sometimes, the local law enforcement isn’t properly equipped to deal with such crimes. You can hire a private investigator and submit your findings to the local police, which may fast-track their investigation.
ZachXBT is a well-known crypto investigator and has effectively solved multiple cases involving high-profile hacks and exploits. Although you may not be able to afford his services, his successes show the effectiveness of hiring a crypto investigator.
You can find local investigators near you by submitting a request on social media forums. However, please make sure they are legitimate before handing over any personal data to them.
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If Mistakenly Sent, Try Contacting the Platform
Most common cases of lost crypto involve a mistakenly sent transfer either within a wallet, or it could be a novice user doing so over their CEX wallet.
If you have sent it to the wrong address, it is likely that you might have lost it permanently. However, since addresses are not random phrases or digits like phone numbers, it is likely that you might have done so with an address that you have copied from somewhere. In this case, it is best to retrace your steps and discover the page, social media post, or app where you saw that address.
If you have lost crypto from a CEX wallet, it is likely that the exchange will recover it. Show them proper documentation of your wallet ownership and request a refund. The exchange may ask the receiver about new transfers and cross-check any information you have provided before they issue a transfer.
Seeking Legal Advice
Laws on recovery and lost assets may differ from country to country. Therefore, it is best to understand what the laws in your country say about the circumstances in which you have lost the crypto. In some areas, the receivers are allowed to keep it, while in others, they must return it. However, in almost all countries and regions, the theft of crypto is considered a criminal offense.
There are multiple crypto-specific lawyers who can help you better than others. You can search for them online with your country’s name. Again, please ensure they are legitimate before sharing any private information.
Communities and Forums
Crypto communities are one of the best places to seek help and advice for your lost crypto. These communities are filled with experts from all over the world and can provide real insights on ways to recover your crypto.
However, sometimes posting on such communities can also make you a target for scammers who may want to seek undue benefit in your desperate times. It is best to avoid personal messages arising from such places, according to our own experience.
A top community for crypto enthusiasts is the subreddit r/cryptocurrency with over 10 million members.
When Recovery Isn’t Possible
Cryptocurrency transfers are rarely fail-safe, and since this technology prioritizes anonymity, it is often difficult to track the person in the real world.
When your losses arise from your fault, it would be wise to accept your losses.
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