Operation Spincaster, a groundbreaking public-private initiative led by cryptocurrency transaction research firm Chainalysis, has successfully shut down cryptocurrency accounts linked to $162 million in losses. The project, which has conducted operational sprints in six countries including the US, the UK, Canada, Spain, the Netherlands, and Australia, involved 100 partners, including 12 public sector agencies and 17 crypto exchanges.
Utilizing actionable intelligence from Chainalysis’ telemetry, Operation Spincaster identified thousands of compromised crypto wallets using its Crypto Investigations solution. This led to the discovery of over 7000 leads related to approximately $162 million in losses due to various cryptocurrency scams. By closing accounts, seizing funds, and building intelligence to prevent future scams, the initiative has made significant progress in combatting fraudulent activities in the crypto space.
One of the primary tactics used by scammers identified in Operation Spincaster is approval phishing, a technique where criminals trick victims into authorizing malicious blockchain transactions that allow the scammers to access and drain the victims’ wallets. Chainalysis reported that over $2.7 billion has been lost to scams leveraging approval phishing since May 2021, highlighting the scale of the issue.
Operation Spincaster’s success was exemplified by its impact in the UK, where over 230 victims were identified, and at least £33 million in funds believed to be the result of approval phishing were discovered. The collaboration between key domestic exchanges, law enforcement agencies, and technology research units has been described as ground-breaking by participating partners.
Operation Spincaster is an extension of Operation Disruption, an earlier initiative conducted by Chainalysis researchers in collaboration with the Calgary Police Service in March 2024. This initial operation identified over 770 individuals, including 119 Canadians, as victims of cryptocurrency fraud, with an estimated combined loss of $59 million. Swift action was taken to notify impacted individuals and prevent further victimization.
The success of Operation Spincaster underscores the importance of public-private sector collaboration in addressing evolving challenges in the cryptocurrency space. By leveraging technology, intelligence, and coordinated efforts, initiatives like Operation Spincaster play a crucial role in safeguarding the public from harm and targeting offenders regardless of their location.