Beyond Wallet Addresses: How Open-Source Intelligence Helps Investigate Cryptocurrency Fraud
Updated: 3 days ago
Blockchain records can reveal the movement of digital assets, but they may not explain how a victim was persuaded to send money or who operated the scheme. Investigators often need to examine the wider digital environment surrounding the transaction.
Open-source intelligence, commonly called OSINT, involves collecting and assessing information that is lawfully available from public sources. Depending on the case, this may include websites, public social media profiles, online advertisements, company records and domain information.
The FBI's Operation Level Up illustrates the importance of looking beyond the transaction itself.
In February 2025, the FBI reported that the initiative had notified more than 4,300 potential victims of cryptocurrency investment fraud and estimated that it had helped prevent approximately US$285 million in losses as of January 2025. The initiative identifies people believed to be actively targeted and intervenes to warn them about the fraud.
How public information can help
A suspicious investment platform may claim to have a long operating history, a registered office or relationships with legitimate financial businesses. Investigators can compare those claims with available public records and preserve relevant material for later review.
Public information may also help identify repeated names, contact details or website elements across different suspected schemes. These similarities can provide investigative leads, but they do not automatically prove that the same person controls each operation.
The reliability of every source should be assessed. Websites can contain false information, online identities can be impersonated and company records may not reveal the individuals ultimately responsible for a scheme.
Prevention is also an investigative outcome
Operation Level Up highlights a crucial point: preventing additional losses can be just as important as investigating money already transferred.
Fraudsters may show victims fake account balances and supposed investment profits to encourage further deposits. Some victims are persuaded to borrow money, sell property or use retirement savings. Timely intervention can interrupt this process.
Building a responsible investigation
Investigators should preserve relevant evidence, document where it came from and distinguish verified facts from assumptions. They should also consider whether a scam is ongoing and whether the victim needs to be warned about further contact.
OSINT is not a substitute for blockchain analysis or formal legal processes. Its strength lies in combining public information with other evidence to develop a clearer understanding of the people, platforms and claims connected to suspected fraud.
Source: FBI — Operation Level Up
Article 10 — Asset Tracing
Title: Beyond the Blockchain: What the Bitfinex Case Teaches Us About Asset Tracing
Author: Richard Bennett — Senior Asset Tracing Consultant
A cryptocurrency investigation may begin with a wallet address, but the movement of value can extend far beyond the original blockchain. Digital assets may be exchanged for other cryptocurrencies, transferred through custodial services or converted into conventional financial assets.
The Bitfinex investigation illustrates the importance of examining the wider financial picture. The US Department of Justice reported that the laundering of Bitcoin stolen in the 2016 Bitfinex hack involved cryptocurrency exchanges, mixing services, darknet markets, bank accounts and conversions between digital assets. Authorities also described the conversion of some proceeds into gold coins.
These details demonstrate why asset tracing should not be limited to recording wallet-to-wallet transfers.
Developing a broader asset picture
Depending on the circumstances, an investigation may examine cryptocurrency transactions, exchange deposits and withdrawals, financial account records, company information and evidence of purchases involving other property.
Each source has its own limitations. A blockchain transaction can establish that assets moved between addresses, but further evidence may be necessary to identify the person controlling them. A company record may identify a director without proving that the director controlled the funds in question.
Investigators should document how each finding relates to the suspected activity and avoid presenting an unverified connection as established fact.
Tracing, ownership and recovery are different questions
Identifying an asset does not automatically establish a legal right to it. Investigators and legal advisers may need to consider ownership, control, competing claims, transfers to third parties and the jurisdiction in which the asset is held.
Even when a connection to suspected proceeds is supported by evidence, a legal process may be required before the asset can be frozen, forfeited or returned.
Why a disciplined approach matters
An investigation that looks too narrowly may miss relevant evidence about where value moved. An investigation that draws broad conclusions from weak connections may waste resources and create false expectations.
The Bitfinex case illustrates the value of examining the wider financial trail while preserving a clear distinction between direct evidence, analytical inference and legal conclusions.
Effective asset tracing does not promise that every asset can be recovered. It provides a structured picture of the available evidence and helps identify which investigative or legal options may be worth considering.
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