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Crypto Pig Butchering Scams Grossed Over $75 Billion, University of Texas Professor Reveals

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A recent study by professors at the University of Texas indicates that crypto scams linked to pig slaughter may have siphoned off tens of billions of dollars.

A new study led by University of Texas finance professor John Griffin and graduate student Kevin Mei suggests that crypto pig slaughter scams may have cost victims around the world more than $75 billion. The research, carried out over four years, from January 2020 to February 2024, involved tracking the flow of funds from more than 4,000 victims to scammers primarily based in Southeast Asia.

Crypto Pig Slaughter Scams Grossed Over $75 Billion, University of Texas Professor Reveals - 1
Network graph of declared addresses and plotted funds | Source: SSRN

Pig butchery scams typically begin with unsolicited text messages, tricking individuals into making fraudulent crypto investments and resulting in substantial financial losses.

According to the study, fraudsters “freely interact” with major crypto exchanges, sending more than 100,000 small potential incentive payments to build trust with victims. Funds are flowing out of the crypto network in large quantities, primarily in Tether (USDT), through “less transparent but important exchanges” like Binance, Huobi, OKX, Crypto.com and Coinbase, the document states.

While the study offers valuable insight into the scale of these scams, concerns have been raised about the difficulties in accurately quantifying the total amount due to under-reporting. For example, Paolo Ardoino, CEO of Tether, disputed the findings. In a commentary with Bloomberg, Ardoino highlighted the platform’s commitment to working with law enforcement to combat fraud.

“With Tether, every action is online, every action is traceable, every asset can be seized, and every criminal can be arrested. We work with law enforcement to do just that.

Paolo Ardoino

Despite efforts by authorities and blockchain analytics companies to combat these illicit activities, criminals continue to exploit decentralized financial protocols to launder their funds.

Griffin and Mei argue that the “legitimate crypto space typically serves as an entry and exit point to the illegitimate space,” adding that for crooks it is “the vital element enabling both the butchery of pigs and modern slavery. Overall, the study suggests that criminal networks move “significant funds” cheaply and “without much fear of detection.”

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