By Retracefi on 5 October 2025

In early 2025, our victim “Samir,” a non-tech-savvy retail crypto user, reached out to Retrace after discovering that his hardware wallet had been emptied. In our first call, he sounded more confused than panicked: he’d bought a reputable device and had been using it for almost a year with no issues. What he hadn’t questioned was the “cryptocurrency consultant” he had hired to help him buy Bitcoin and guide him through his wallet setup.

They walked through the wallet’s first-time initialization together. The consultant insisted on being present for each step “to avoid mistakes.”

Months after that session, 2 BTC left Samir’s wallet in a single sweep. Within days, the coins were routed into an instant-swap service—one of those “no-account, fast quotes” platforms—then converted into stablecoins. By the end of the first week after the incident, the flow had split and reconverged twice across similar services. The on-screen effect looked chaotic; on-chain it was a tidy sequence meant to blur origins.

When Samir contacted us, he only knew the end result: a zero balance. He didn’t yet know that his BTC had been transformed into roughly 200,000 USDT, then pushed through a few more hops before landing at a large, KYC’d exchange. For context, at today’s price 1 BTC exceeds $100,000.

What We Found (Investigation Summary)

Our team reconstructed the path from Samir’s wallet to the off-ramp:

1. The thief moved 2 BTC → USDT (~$200k) through an instant-swap service, then cycled USDT through additional quick-swap venues (“peel and pass” timing typical of laundering attempts).
2. The trail converged at a centralized exchange cluster we’ve cataloged—deposit patterns, hot-wallet adjacency, and crediting windows were a match.

What Happened Next

With Samir’s consent, Retrace packaged the evidence—a full hop-by-hop map, timestamps, TXIDs, screenshots of swap quotes, and the attribution logic tying deposits to the exchange—and worked two tracks in parallel:

• Preservation & freeze requests to the identified exchange and the swap venues;
• Law-enforcement referral with an evidence binder designed for rapid subpoenas (including the insider-risk narrative from Samir’s interview).

The responding agency obtained subscriber records. The KYC on the destination account matched the consultant’s identity and contact details. Faced with the documentary chain and an active case number, the consultant capitulated—returning most of the funds and surrendering additional assets purchased with the stolen crypto. The outcome for Samir was that he recovered the majority of his loss.

Notes

• A hardware wallet can’t save a leaked seed – If anyone sees or records your recovery phrase—even once—the wallet is theirs.
• Instant-swap ≠ invisibility. Liquidity choke points and exchange clusters make “quick-hop” laundering traceable.
• Move fast. Early, well-documented incident reporting and investigation processes improve odds of recovery.

Prepared by the Retrace Investigations team. Amounts and USD equivalents use the current BTC spot price (≈ $114k/BTC; 2 BTC ≈ $228k). The thief realized ~$200k USDT at the time of conversion, reflecting contemporaneous pricing and fees. Victim name is altered.