How modern cryptocurrency scams work

Cryptocurrency fraud has been increasing significantly for years. More and more people are falling victim to fraudulent investment offers that are professionally designed and appear legitimate. The perpetrators operate in an organized, international manner with clear strategies. Their goal is to build trust and persuade victims to make financial deposits over an extended period.

A particularly common and serious form of fraud is known internationally as „Pig Butchering“ This is a structured investment fraud in which victims are gradually financially exploited.

Increasing cases of crypto fraud – also in Germany

Crypto fraud is not a fringe phenomenon. The number of known cases is also rising significantly in Germany. Consumer protection agencies report a growing number of complaints related to fraudulent crypto investments. In the first half of 2025 alone, several hundred such cases were reported nationwide.

Experts assume that the actual number of victims is significantly higher. Many people do not report the fraud, for example out of shame, uncertainty, or because they don't know who to contact.

Cryptocurrencies are difficult for many people to understand. Technical processes, trading platforms, and legal frameworks appear complex and opaque. Furthermore, cryptocurrencies are not legal tender in most countries and are not subject to any government protection scheme like traditional bank deposits.

This provides ideal conditions for fraudsters. Transactions are digital, often cross-border, and use wallet structures that are difficult for laypeople to understand. Payment flows can be routed through multiple intermediaries, further complicating the process.

For those affected, it is therefore often unclear where their money actually is and whether it has been invested in real terms.

Establishing contact and building trust in a targeted manner

Initial contact is usually made via social networks, messaging services, or professional platforms. Sometimes, those affected come across advertisements, videos, or posts in which supposedly successful investors or well-known personalities recommend specific crypto platforms.

Trust is not built abruptly, but gradually. The perpetrators appear friendly, factual, and competent. They often take their time, explain procedures, and initially avoid making large demands.

Many people affected are going through periods of personal or financial upheaval and are therefore more susceptible to supposedly safe or particularly lucrative investment opportunities. It is important to note: Even experienced, well-informed people are affected., because the fraud schemes are implemented professionally.

„Pig Butchering“ – a multi-stage fraud scheme

Pig butchering is a systematically structured investment fraud. Initially, trust is built up over weeks or months. Subsequently, victims are persuaded to make initial, small investments.

On manipulated platforms, these deposits appear successful. Apparent winnings are displayed to build trust. In the next phase, larger amounts are requested, often with reference to special market opportunities or limited-time offers.

Once no further deposits are made or the financial potential is exhausted, contact usually breaks off abruptly. At this point, the invested funds are generally no longer accessible.

Organized perpetrator structures instead of individual perpetrators

These fraudulent schemes are usually not the work of individuals, but rather of networks organized according to a division of labor. Some groups handle initial contact, others conduct conversations, while still others are responsible for the technical operation of the platforms or payment processing.

In some cases, there are veritable supply chains for fake profiles, applications, or money laundering mechanisms. This practice is also known as Crime-as-a-Service described. Law enforcement agencies report large-scale, call center-like structures, particularly in Southeast Asia.

Consequences for those affected and high number of unreported cases

The financial consequences for those affected are often considerable. Many lose a large portion of their assets. In addition to the economic damage, severe psychological distress often occurs. Shame, fear, or self-reproach lead many victims to not seek help.

The later fraud is detected, the more difficult it becomes to trace payments or take further action. Early notification and objective information are therefore crucial.

Legal classification and Support for victims of crypto fraud

The Crypto Investigation supports affected parties in the structured evaluation of blockchain transactions and works closely with lawyers and investigative authorities to secure digital assets and enable restitution.

Legally, these cases regularly constitute investment fraud. Even though cryptocurrencies appear anonymous, transactions on public blockchains are fundamentally traceable.

However, investigating such cases requires specialized expertise. In addition to legal knowledge, a technical understanding is necessary to analyze payment methods and present the facts in a comprehensible manner.

FAQs – Frequently Asked Questions about Crypto Fraud

What is crypto fraud?

Crypto fraud encompasses fraudulent activities that use cryptocurrencies to financially harm people. Typical examples include manipulated trading platforms, fictitious investment offers, or deliberate abuse of trust. Victims often believe they are investing in genuine cryptocurrencies, while in reality, their deposits are controlled by perpetrators.

What is "pig butchering" and why is this practice so dangerous?

„"Pig butchering" refers to a long-term investment fraud. Perpetrators build trust over weeks or months before gradually persuading victims to make increasingly larger investments. The reported returns are usually manipulated. This scam is particularly dangerous because it creates an emotional bond, and victims often only realize they have been defrauded very late.

How can I tell if I might have become a victim of cryptocurrency fraud?

Warning signs include problems with withdrawals, suddenly demanded additional fees, unexplained profits on platforms, or a breakdown in communication. Pressure to quickly invest further amounts is also typical. Extra caution is advised if platforms are only accessible via messenger or if no verifiable company information is available.

Why are crypto fraud platforms often designed to be so convincing?

The fraudulent platforms are technically sophisticated. They display realistic-looking price charts, account balances, and profits. The goal is to build trust and dispel doubts. However, these displays often do not reflect genuine blockchain transactions.

Are experienced investors or technically skilled individuals also affected?

Yes. Crypto fraud isn't just aimed at beginners. People with business or technical experience also fall victim, as the scams deliberately rely on appearances of legitimacy and technical jargon. Perpetrators often tailor their communication to the individual knowledge level of their victims.

Is it even possible to trace crypto transactions?

Even though cryptocurrencies appear anonymous, transactions on public blockchains are fundamentally traceable. However, analysis requires specialized expertise. Payment flows can involve many intermediaries, making tracking complex, but not impossible.

Why is it important to react early?

The earlier a suspected case of fraud is detected, the better the chances of analyzing payment flows and securing relevant information. Delays make investigations more difficult, as funds are often redirected or concealed. Early documentation is also crucial for legal action.

Should I feel ashamed or guilty about crypto fraud?

No. Crypto fraud is professionally organized and specifically designed to exploit trust. Many victims feel guilty afterward, even though they were systematically deceived. Shame often prevents them from seeking help, which can worsen the situation.

What steps are advisable after a suspected fraud?

Those affected should refrain from making any further payments and should secure any existing information, such as communication histories, transaction data, or screenshots of the platform. An objective assessment of the situation will help in planning further action and avoiding unnecessary mistakes.

Why is it important to react early?

The earlier a suspected case of fraud is detected, the better the chances of analyzing payment flows and securing relevant information. Delays make investigations more difficult, as funds are often redirected or concealed. Early documentation is also crucial for legal action.

What support can Crypto Investigation provide in cases of crypto fraud?

Crypto Investigation assists in the analysis of blockchain transactions, the tracing of payment paths, and the structured processing of the facts. The goal is to clarify the course of the fraud and to prepare information in a way that allows it to be used for further action.