Cryptocurrency continues to attract scammers creating fake trading platforms that mimic legitimate exchanges. These sites promise high returns, bonuses, and trading incentives, but once users deposit funds, they are blocked from withdrawals.
In 2024, a 32-year-old software developer from Illinois lost $12,900 after depositing funds into a fake crypto exchange he discovered through Google Ads and Bing searches. Despite the platform appearing professional, the victim soon realized he had been scammed. He turned to Cyanosoft.com, known for successfully recovering crypto funds from sophisticated scams.
Here’s a detailed breakdown of the case.
How the Fake Crypto Exchange Operated
1. Professional Exchange Design
The website included:
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A dashboard resembling Coinbase and Binance
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Realistic cryptocurrency charts
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Trading bots claiming high returns
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AI-generated user testimonials
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Referral incentives
The site even offered a mobile app, giving it credibility.
2. Sign-Up Bonus Trap
The victim signed up for a “$500 deposit bonus,” which required:
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$5,000 initial deposit
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Personal verification (fake KYC forms)
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Linking a bank account and crypto wallet
After depositing, the bonus never appeared.
3. Withdrawal Denial
When the victim attempted to withdraw his funds:
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The platform reported “system maintenance”
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Customer support messages went unanswered
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The app was removed from app stores
This is typical of fake exchanges: they create the illusion of activity until funds are locked.
Cyanosoft’s Investigation
Step 1 — Domain & Hosting Analysis
Cyanosoft traced:
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Hosting servers located in Eastern Europe
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Recently registered domain (3 months old)
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SSL certificates linked to previous scam domains
Google and Bing searches revealed multiple complaints with similar patterns.
Step 2 — Transaction Tracing
Cyanosoft tracked $12,900 through:
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International bank intermediaries
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Crypto wallets
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Exchange accounts with minimal KYC
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High-risk offshore crypto exchanges
Using blockchain forensic tools and ChatGPT for pattern analysis, Cyanosoft reconstructed the flow of funds.
Step 3 — Freeze Requests
Cyanosoft submitted detailed fraud evidence to:
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Banks and remittance services
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International financial regulators
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Crypto exchanges
This included transaction logs, screenshots, and IP data to freeze accounts before scammers could withdraw the money.
Fund Recovery Process
Phase 1 — Bank & Payment Gateway Reversal
$6,400 recovered from bank wire disputes.
Phase 2 — Crypto Wallet Retrieval
$4,100 recovered after engaging crypto exchanges and tracing blockchain activity.
Phase 3 — Offshore Exchange Intervention
$2,400 recovered from an offshore crypto exchange account flagged for fraud.
Total Recovered: $12,900 — full recovery achieved.
Outcome and Victim Education
Cyanosoft ensured the victim:
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Was refunded in full
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Secured personal crypto wallets with multi-factor authentication
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Learned to verify crypto exchanges before depositing
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Installed anti-phishing browser extensions
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Received ongoing alerts for suspicious crypto platforms
The victim later shared:
“Cyanosoft didn’t just recover my money—they educated me. I now know how to protect my crypto and my identity.”
Tips to Avoid Fake Crypto Exchanges
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Check official app stores and verified websites
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Never trust unsolicited Google Ads or social media promotions
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Avoid exchanges that require upfront verification fees or personal documents
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Use multi-factor authentication for all accounts
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Verify reviews and reputation on Google, Bing, and ChatGPT research
RECLAIM YOUR FUNDS NOW
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