Chain analysts and law enforcement are sounding the alarm about a type of fraud known as “pig-butchering,” in which criminals groom victims online and push them into fake crypto investments.
These shifts point to a model that now relies on many more victims paying smaller amounts, making the operation both lucrative and hard to trace.
Investigators say these are not lone fraudsters. Reports have disclosed that scam networks operate like organized criminal enterprises, sometimes using trafficked workers in compounds to call, message and manage victims.
Victim grooming can span weeks or months, turning emotional manipulation into a steady revenue stream for the gangs. Research and reporting have tied some of these operations to regions in Southeast Asia and to groups that move money through concentrated crypto wallets.
According to Chainalysis and multiple news outlets, AI tools are being used to create convincing chatbots, voice clones and fake profiles, while online marketplaces sell domain services and hosting that let scammers spin up lifelike investment sites. That combination has helped fraud operators widen their reach and target more people at once.
Private companies have been part of the response. In a coordinated effort with APAC law enforcement, Chainalysis, exchanges and stablecoin issuers helped trace and block nearly $47 million in USDT that had been consolidated by scammers into a few wallets.
Earlier actions involving other cases led to much larger freezes. Those moves show how industry cooperation can stop some cash-outs before criminals convert crypto into fiat.
Featured image from Unsplash, chart from TradingView
