The U.S. Secret Service has quietly become a major player in the crypto world—not as an investor but as an enforcer. Over the past decade, the agency has seized nearly $400 million worth of digital assets, Bloomberg reported Saturday, citing people familiar with the matter.
Much of the seized cryptocurrency is held in a single cold-storage wallet, making it among the largest known caches controlled by any law enforcement body.
The holdings stem from a wave of investigations into online investment scams and fraud schemes that have mushroomed alongside the digital asset boom. Jamie Lam, an investigative analyst with the Secret Service, told law enforcement officials in Bermuda last month that criminals often lure victims by posing as romantic interests or financial advisors on social media.
“They’ll send you a photo of a really good-looking guy or girl,” Lam explained.
“But it’s probably some old guy in Russia.”
Once victims are hooked, scammers entice them to deposit funds on professional-looking crypto platforms that eventually disappear—taking deposits and personal data with them.
Digital Breadcrumbs and Global Training Uncover Hidden Networks
The Secret Service’s Global Investigative Operations Center has built a reputation for tracing sophisticated schemes back to their source using blockchain analytics, domain records, and human error on the part of scammers.
Lam’s team has unraveled elaborate webs of transactions by patiently following digital breadcrumbs. In one investigation, a brief VPN malfunction exposed a scammer’s real IP address, allowing agents to connect a cryptocurrency wallet to an identifiable user.
Leading these efforts is Kali Smith, who has overseen training for law enforcement agencies in over 60 countries. The team often targets regions with weak regulatory enforcement or residency-for-sale programs that can be exploited for financial crimes.
“Sometimes after just a week-long training, they can be like, ‘Wow, we didn’t even realize that this is occurring in our country,’” Smith said.
Cases have ranged from elaborate romance-investment cons to more disturbing extortion schemes. In one instance, an Idaho teenager was pressured to send explicit photos to an online stranger who then demanded payments to keep the images private.
Analysts followed the extorted funds through a chain of coerced intermediaries, eventually tying the transactions to a Nigerian passport and a wallet involved in over $4 million in suspect transfers. British police arrested the alleged perpetrator upon his arrival in Guildford, England, where extradition proceedings are underway.
Crypto Fraud Now the Top Source of U.S. Internet Crime Losses
The Secret Service’s growing crypto haul reflects a broader surge in digital asset crime. According to FBI figures, Americans lost $9.3 billion to crypto-related scams in 2024—accounting for more than half of all reported internet fraud losses that year.
The trend has continued into 2025, with over $2.47 billion stolen through hacks, exploits, and social engineering schemes in just the first six months—a slight increase compared to the same period in 2024.
Recovering stolen funds often depends on cooperation from major exchanges and stablecoin issuers. Companies like Coinbase and Tether have played key roles in tracing funds and freezing suspect accounts.
One of the largest single recoveries involved $225 million in USDT linked to a widespread romance scam operation that targeted victims across multiple countries.
As digital assets become further intertwined with the global financial system, authorities warn that vigilance, education, and cross-border cooperation will be essential to combatting the next wave of crypto-enabled crime.
Quick Facts
- The U.S. Secret Service has seized nearly $400 million in cryptocurrency over the past decade.
- Crypto scams accounted for $9.3 billion in losses in the U.S. last year.
- Investigators have relied on blockchain analysis and international partnerships to track stolen funds.
