In a remarkable recovery effort, Texas police — with help from Chain Retrieval — recovered $25,000 lost in a crypto scam involving a Bitcoin ATM.
The case raises a growing concern in the U.S. Crypto scammers are tricking people into transferring money through ATMs. The method is becoming more common because it is fast and anonymous, according to the FBI’s Internet Crime Complaint Center (IC3). In this case, quick coordination and blockchain tracking stopped the fraud in its tracks.
A High-Stakes Crypto Scam Unfolds in Texas
A man from Lakeway, Texas, recently fell victim to a crypto scam that targets unsuspecting individuals. Lakeway police said a caller posed as a federal agent. The caller claimed the victim’s identity had been stolen and that he was under investigation for money laundering.
In a panic, the victim withdrew money from his bank and deposited it into a Bitcoin ATM to “secure” his funds. The scammers told him this was part of a government process to verify his innocence.
Over two days, the victim sent $25,000 in Bitcoin using ATMs in both Lakeway and Austin. When he realized something was wrong, he contacted the police. By that time, the scammers had already converted the funds into cryptocurrency. In most cases, victims never get their crypto back once it moves on the blockchain, as Chainalysis research has shown.
But this time, things played out differently.
Chain Retrieval’s Fast Action Tracks and Recovers Funds
Chain Retrieval is a private crypto investigation firm that traces blockchain transactions. They worked with the Lakeway Police Department to follow the stolen funds. Using blockchain analysis, the team quickly identified the addresses involved.
In a rare win, they flagged the destination wallet and alerted exchanges. This step froze the assets before scammers could cash them out or move them further.
Within days, they recovered the $25,000 and returned it to the victim.
The outcome is unusual. The FBI says most crypto scam losses end permanently because blockchain transactions are irreversible. But Chain Retrieval proved that expert use of blockchain transparency can reverse damage in certain cases.
Police Warn Public: Don’t Use Crypto in Emergencies
The Lakeway Police Department warns residents to ignore any phone call demanding payment through crypto ATMs or gift cards. No legitimate government agency will ever request cryptocurrency or rush payments over the phone.
They also urge people to be cautious with unknown callers, especially those claiming to be from the IRS, FBI, or other federal offices.
With crypto scams on the rise, especially those exploiting fear or urgency, experts advise people to pause before acting. Always verify the source before sending money — and review FTC guidance on spotting scams.
Chain Retrieval’s success in this case offers hope. Still, recovering stolen funds is rare. Prevention remains the strongest defense.