How to Recover Money Stolen Through Rug Pulls

Rug pulls are one of the most devastating crypto scams, but you can recover money stolen through rug pulls. This type of crypto scam drains billions from unsuspecting investors each year. Whether you’re a seasoned DeFi user or a newcomer lured by high returns, the sudden disappearance of a project along with your funds can feel like financial whiplash. 

The fundamental features of blockchain, such as pseudonymity, transaction irreversibility, and the absence of centralized oversight, make it exceptionally difficult to track scammers or recover stolen assets.

Money stolen through rug pulls can be recovered following this guide, which was designed to help victims of rug pulls understand their options. Take immediate action and explore realistic paths to recover money stolen through rug pulls.

Overview & Who This Guide Is For

• Estimated losses from rug pulls in 2022 alone exceeded $2.8 billion, according to blockchain analytics firm Chainalysis.
• Rug pulls account for over 37% of all crypto scam revenue.
• This guide is for:
  • Victims of rug pulls seeking recovery strategies.
  • Crypto investors want to understand the mechanics of scams.
  • Legal professionals, journalists, and blockchain analysts.

Understand the Rug Pull

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Before you can recover stolen crypto, you need to understand how rug pulls work.

Types of Rug Pulls

Type	Description
Dev Exit	The token is listed on a decentralized exchange, then manipulated or removed. Definition: What Is a ‘Rug on DEX Crypto Scam’? A Rug on DEX crypto scam is a type of crypto fraud in which the creators or developers of a DeFi project (such as a token, yield farm, or NFT collection) suddenly withdraw all critical funds or liquidity from a decentralized exchange trading pool, causing the price of the associated asset to collapse and leaving investors with worthless tokens. The term “rug pull” is evocative of pulling the rug out from under someone, metaphorically describing the abrupt nature of the scam, as developers “vanish” with the pooled funds, often erasing all online presence and support in the process. Unlike many traditional scams, a rug on DEX crypto scam thrives on the unique features of decentralized finance: Open, Permissionless Platforms: Anyone can launch a token or smart contract on a DEX with minimal oversight, vetting, or regulation. Pseudonymous Teams: Developers can remain anonymous or use fake identities, complicating accountability. Irreversibility: Blockchain transactions are typically irreversible, making it nearly impossible to recover funds after a successful rug pull.
Fake Liquidity	Developers abandon the project, taking all funds. A Dev Exit rug pull is a form of exit scam in which cryptocurrency developers, often operating under the guise of a legitimate project, abruptly abandon their creation and vanish with investors’ funds. The term “Dev Exit” refers specifically to the developers’ deliberate and sudden departure, leaving investors with worthless tokens and no recourse. It is an intentional, premeditated act with the sole objective of financial gain at the expense of participants who trusted the project. Dev Exit rug pulls are enabled by the permissionless and often pseudonymous nature of DeFi, where launching tokens is trivial, vetting is minimal, and code auditing can be easily circumvented. Unlike projects that fail due to mismanagement or market forces, a rug pull is predicated on fraudulent intent from inception. The goal is not innovation or ecosystem improvement, but manipulation and theft.
Rug on DEX	The token is listed on a decentralized exchange, then manipulated or removed. Definition: What Is a ‘Rug on DEX Crypto Scam’? A Rug on DEX crypto scam is a type of crypto fraud in which the creators or developers of a DeFi project (such as a token, yield farm, or NFT collection) suddenly withdraw all critical funds or liquidity from a decentralized exchange trading pool, causing the price of the associated asset to collapse and leaving investors with worthless tokens. The term “rug pull” is evocative of pulling the rug out from under someone, metaphorically describing the abrupt nature of the scam, as developers “vanish” with the pooled funds, often erasing all online presence and support in the process. Unlike many traditional scams, a rug on DEX crypto scam thrives on the unique features of decentralized finance: Open, Permissionless Platforms: Anyone can launch a token or smart contract on a DEX with minimal oversight, vetting, or regulation. Pseudonymous Teams: Developers can remain anonymous or use fake identities, complicating accountability. Irreversibility: Blockchain transactions are typically irreversible, making it nearly impossible to recover funds after a successful rug pull.

Mechanics of Fund Movement

• Scammers deploy a token with malicious smart contract code.
• They attract liquidity and hype via social media and influencers.
• Once liquidity is high, they execute a function to drain funds.
• Funds are often swapped into ETH, BTC, or stablecoins.
• Laundering follows via mixers, bridges, or centralized exchanges.

Immediate Containment Steps to Recover Money Stolen Through Rug Pulls

Time is critical. The faster you act, the better your chances of recovery.

Step-by-Step Containment

1. Stop Trading Immediately
   • Cease all interactions with the token or platform.
   • Avoid further approvals or transactions.
2. Freeze Related Accounts
   • Contact exchanges or wallets to freeze assets if possible.
   • Enable 2FA and change passwords.
3. Document Everything
   • Save transaction hashes (TxIDs), smart contract addresses.
   • Archive promotional materials, tweets, and Discord messages.
   • Screenshot wallet balances and interactions.

Technical Tracing (Step-by-Step)

Tracing stolen funds is possible thanks to blockchain transparency.

How to Read a Transaction

• Use blockchain explorers like Etherscan or BscScan.
• Look for:
  • From and To addresses.
  • Token transfers (ERC-20, BEP-20).
  • Internal transactions (contract calls).

Copy the transaction ID of your completed swap and paste it into the block explorer of the relevant network, etherscan, or BscScan. The block explorer will show the transaction details, the input, and the output tokens, the amount and the fees

Token vs. Native Coin Tracing

Asset Type	Tracing Method
Native Coin	Direct transfers (ETH, BNB, etc.)
Tokens	Use token tracker tabs on explorers

Following Swaps and Bridges

Check Complete Swap on PancakeSwap

• Identify swaps on DEXs (Uniswap, PancakeSwap).
• Look for bridge transactions (e.g., Ethereum to BSC).
• Use tools like Arkham or Breadcrumbs to visualize flow.

Steps to Identify Swap on PancakeSwap:

• Connect your wallet

• Click “Trade” and then “Exchange

• Select your tokens in the “From” and “To” fields, and input the amount

• Review the displayed transaction details, such as the exchange rate and slippage tolerance, and then click “Swap” to execute the transaction

•  The token swap will then be visible in your connected wallet  

Tools to Use

Here are the best tools for tracing and analysis:

Tool	Use Case
Etherscan	Ethereum transaction and contract analysis
BscScan	Binance Smart Chain explorer
Arkham	Wallet clustering and fund tracing
Breadcrumbs	Visual transaction mapping
Chainalysis	Enterprise-grade forensic analysis
Nansen	Wallet behavior and token flow

If Funds Reach a Centralized Exchange (CEX)

Centralized exchanges offer a slim chance of freezing stolen assets.

Steps to Take

1. Identify Deposit Address
   • Use explorers to find where funds landed.
2. Prepare Evidence
   • Compile TxIDs, screenshots, and scam details.
3. Submit Freeze Request
   • Contact the exchange’s support or legal team.
   • Include all documentation and request an asset freeze.
4. Realistic Outcomes
   • Exchanges may freeze assets if they have not been moved.
   • Legal intervention may be necessary for the return of assets.

If Funds Are Laundered Through Mixers/Bridges

Mixers obscure fund trails, making recovery difficult.

What Mixers Do

• Combine multiple transactions to hide the origin.
• Popular mixers: Tornado Cash, Blender.io..

Limitations of Recovery

• Funds become untraceable after mixing.
• Legal action may be the only recourse.

Collecting Evidence for Law Enforcement

• Document mixer entry TxIDs.
• Note wallet addresses and timestamps.
• Include screenshots and social media posts.

Legal Options by Jurisdiction

Legal action varies by country, but can be effective.

Civil Suits & Criminal Complaints

Jurisdiction	Legal Pathways
United States	FBI Cybercrime Unit, SEC complaints
UK	Action Fraud, FCA reporting
Nigeria	EFCC, Nigeria Police Force Cybercrime
EU	Europol, national cybercrime units

Documents Needed

• Identity verification (KYC).
• Transaction history.
• Evidence of scam (screenshots, messages).
• Legal representation (optional but recommended).

Working with Blockchain Recovery Services

Professional recovery firms specialize in crypto forensics.

What to Expect

• Initial consultation and wallet analysis.
• Fee structure: flat rate or success-based.
• Timeline: weeks to months, depending on complexity.

Questions to Ask

• What’s your success rate?
• Do you work with law enforcement?
• Can you trace across chains and mixers?

Community & PR Pressure

Public exposure can pressure scammers and exchanges.

Best Practices

• Post on Reddit (r/CryptoCurrency, r/Scams).
• Tweet with relevant hashtags and tag exchanges.
• Contact crypto journalists (CoinDesk, The Block).

Risks

• Avoid doxxing or false accusations.
• Stick to facts and documented evidence.

Insurance, Chargebacks & Banks

Crypto is largely irreversible, but fiat rails offer rare options.

When Banks Can Help

• If you paid via credit card or bank transfer to a scam exchange.
• File a chargeback or fraud report with your bank.

Using Linked Fiat Rails

• Look for fiat onramps used by scammers.
• Report to payment processors (PayPal, Stripe).

Prevention & Rebuilding

Avoid future rug pulls with proactive security.

Due Diligence Checklist

• Verify team identities (LinkedIn, GitHub).
• Check smart contract audits (CertiK, Quantstamp).
• Review tokenomics and liquidity lock status.
• Use multisig wallets for pooled funds.

Templates & Resources

Reporting Email Template

text

Subject: Urgent – Request to Freeze Assets Linked to Crypto Scam

Dear [Exchange Name] Support,

I am writing to report a crypto scam involving stolen funds deposited into your platform. Below are the details:

– Transaction Hash: [TxID]

– Scammer Wallet: [Address]

– Deposit Address on Your Exchange: [Address]

– Date/Time: [Timestamp]

– Supporting Evidence: [Screenshots, links]

Please initiate a freeze and advise on next steps.

Sincerely,  

[Your Name]  

[Contact Info]

Evidence Checklist

• Wallet address and TxIDs
• Screenshots of scam interactions
• Smart contract address
• Social media posts
• Exchange deposit address
• Mixer entry points (if applicable)

🔗 Useful Links

• Etherscan
• BscScan
• Arkham Intelligence
• Chainalysis
• Reddit Scam Alerts

Related Posts:

Worst Crypto Rugg Pulls that Ever Happened

How to Spot a Crypto Scam: Common Red Flags

Conclusion

Recovering money stolen through a rug pull is challenging but not impossible. With swift action, detailed documentation, and the right tools, you can trace stolen funds and pursue legal or community-driven recovery paths. While mixers and anonymity pose hurdles, centralized exchanges and blockchain forensics offer hope.

Key Takeaways

• Act fast: freeze accounts and document everything.
• Use blockchain explorers and tracing tools.
• Engage exchanges and law enforcement with evidence.
• Consider recovery firms and public exposure.
• Strengthen defenses to prevent future losses.

Stay vigilant, stay skeptical, and never invest without doing your own research. If you’ve been affected, this guide is your roadmap to reclaiming control and hopefully, your money stolen through rug pulls.

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