Decentralized finance promised to revolutionize investing by removing traditional intermediaries. Instead, it created new opportunities for sophisticated fraud that has cost investors billions. In 2025 alone, cryptocurrency scams stole an estimated $17 billion, with DeFi fraud representing a rapidly growing portion of these losses. The average scam payment increased from $782 in 2024 to $2,764 in 2025, a staggering 253% year-over-year growth.
Unlike traditional investment fraud, DeFi scams exploit blockchain technology, smart contracts, and the decentralized nature of cryptocurrency platforms to steal investor funds. Victims often believe they have no recourse because transactions cannot be reversed and perpetrators operate anonymously. However, DeFi investment fraud violates securities laws, and legal remedies exist for victims willing to pursue them.
Key Takeaways
- DeFi fraud is exploding: Estimated $17 billion stolen in crypto scams during 2025, with impersonation scams growing 1,400% year-over-year
- It is illegal: DeFi scams violate securities laws, wire fraud statutes, and money laundering regulations
- Legal recourse exists: Victims can pursue civil lawsuits, regulatory complaints, and criminal referrals
- Restitution is challenging but possible: Blockchain forensics, asset freezes, and regulatory enforcement can help trace stolen funds
- Act quickly: Early intervention significantly improves the prospects for restitution
What is Decentralized Finance (DeFi)?
Decentralized finance refers to financial services provided by algorithms running on blockchain technology, without traditional intermediaries like banks or brokers. DeFi platforms enable users to lend, borrow, trade, and invest in cryptocurrencies directly through smart contracts, which are self-executing programs that automatically enforce transaction terms.
The appeal of DeFi lies in its promise of higher returns, greater transparency through public blockchains, and freedom from traditional financial institutions. However, these same characteristics create vulnerabilities that fraudsters exploit. The lack of regulatory oversight, irreversible transactions, and technical complexity make DeFi platforms attractive targets for sophisticated scams.
The DeFi ecosystem includes various platforms and services:
- Decentralized exchanges (DEXs): Trading platforms without centralized control
- Lending protocols: Automated systems for borrowing and lending cryptocurrency
- Yield farming platforms: Services promising high returns for depositing cryptocurrency
- Liquidity pools: Collections of locked tokens used to facilitate trading
- Staking platforms: Services that pay rewards for holding specific cryptocurrencies
What is DeFi Investment Fraud?
DeFi investment fraud occurs when bad actors use decentralized finance platforms to defraud investors through misrepresentation, manipulation, or theft. These scams often disguise themselves as legitimate DeFi projects with professional websites, detailed whitepapers, and active social media presence. The fraud typically involves one of several schemes designed to separate investors from their cryptocurrency.
According to Chainalysis research, cryptocurrency scams received at least $14 billion on-chain in 2025, up from $9.9 billion in 2024. DeFi fraud represents a significant and growing portion of this total. The U.S. Securities and Exchange Commission has taken enforcement actions against DeFi operators, including charging two Florida men and their Cayman Islands company for unregistered sales of more than $30 million using smart contracts and DeFi technology.
DeFi investment fraud differs from traditional investment scams in several critical ways. The decentralized nature of blockchain makes it difficult to identify perpetrators. Transactions are irreversible, eliminating the “cooling off” period that exists with traditional investments. The technical complexity creates information asymmetry between sophisticated fraudsters and average investors. Finally, the regulatory landscape remains uncertain, with many victims unsure whether consumer protections apply.
Common Types of DeFi Fraud
Rug Pulls
Developers create a new DeFi token or project, attract significant investor funds, then suddenly drain the liquidity pool and disappear. These scams often feature slick websites and professional-looking whitepapers.
Example: Arbix Finance executed a rug pull in January 2022, draining $10 million from investors despite being audited by a smart contract auditor.
Yield Farming Scams
Fraudulent platforms promise unrealistically high returns for depositing cryptocurrency. After accumulating substantial deposits, operators either disappear with funds or manipulate smart contracts to steal assets.
Example: MaxAPY promised a 960,000% annual return before its operators vanished in April 2022, causing the token to drop 67%.
Smart Contract Fraud
Malicious code hidden in smart contracts allows developers to steal funds, prevent token sales, or manipulate balances. Technical complexity makes these scams difficult for average investors to detect.
Techniques include: Honeypots that prevent reselling, hidden mints creating unlimited tokens, and hidden fee modifiers up to 100%.
Flash Loan Attacks
Sophisticated attackers exploit vulnerabilities in DeFi protocols by borrowing massive amounts of cryptocurrency, manipulating prices, and repaying loans within a single transaction.
Impact: Harvest Finance suffered a multi-million-dollar flash loan attack in 2020.
Fake DeFi Platforms
Entirely fraudulent websites impersonating legitimate DeFi protocols or creating fake platforms with no actual functionality. These sites collect deposits that are immediately stolen.
Scale: Over 212,000 scam tokens were created between September 2020 and January 2022.
Liquidity Pool Manipulation
Fraudsters create fake tokens mimicking real projects and list them on decentralized exchanges. Unsuspecting investors buy worthless tokens believing they’re purchasing legitimate cryptocurrency.
Red flag: Tokens with identical names to established projects but different contract addresses.
How DeFi Scams Work: Technical Mechanics
Understanding the technical mechanics of DeFi fraud helps investors recognize warning signs and assists attorneys in building cases against perpetrators. Most DeFi scams exploit the immutable nature of blockchain transactions combined with the technical complexity that prevents average investors from understanding what’s happening until it’s too late.
A typical DeFi rug pull follows this pattern:
- Project Launch: Developers create a new token and DeFi platform with professional branding, detailed documentation, and active social media promotion
- Liquidity Creation: The project establishes a liquidity pool on a decentralized exchange, typically pairing their new token with a established cryptocurrency like Ethereum
- Marketing Phase: Aggressive promotion through social media, influencers, and community building creates FOMO (fear of missing out)
- Initial Success: Early investors see gains as the token price rises, encouraging additional investment and creating social proof
- The Rug Pull: Developers execute hidden functions in the smart contract to drain liquidity pools, often completing the theft in minutes
- Disappearance: All online presence vanishes including websites, social media accounts, and community channels
Smart contract fraud employs several sophisticated techniques that most investors cannot detect without technical expertise. Honeypot contracts contain code that allows buying tokens but prevents selling them. Investors can see their account balance increase but discover they cannot cash out. Hidden mint functions let developers create unlimited new tokens, diluting existing holders’ value to zero. Ownership backdoors maintain developer control despite claims of renounced ownership. Hidden fee modifiers can set selling fees as high as 100%, effectively locking investor funds.
Warning Signs of DeFi Investment Fraud
Red Flags That Should Raise Immediate Concerns
- Unrealistic return promises: Any platform promising guaranteed returns above 10-20% annually deserves extreme skepticism
- Unaudited smart contracts: Legitimate projects undergo third-party security audits by reputable firms
- Anonymous development teams: Credible projects identify their developers and leadership
- Pressure tactics: Urgency to invest before “missing out” on limited-time opportunities
- Poor documentation: Vague whitepapers lacking technical details or economic models
- No working product: Projects seeking investment without demonstrable functionality
- Copied code: Smart contracts plagiarized from other projects
- Locked liquidity: Liquidity pools without time-locks that prevent sudden withdrawal
- Concentrated ownership: Large percentages of tokens held by a few wallets
- Social media only marketing: Legitimate projects maintain professional communications beyond Twitter and Telegram
According to research, over 64% of DeFi scams in 2025 followed a specific pattern: lure, manipulate, drain, disappear. Recognizing this pattern early provides the only opportunity to avoid losses or take quick action to minimize damage.
The Legal Status of DeFi Fraud
DeFi investment fraud is unequivocally illegal under multiple state and federal laws, despite the decentralized nature of the technology involved. The fact that a scam uses blockchain technology and smart contracts does not exempt it from securities laws, wire fraud statutes, or money laundering regulations.
The Securities and Exchange Commission has established that many DeFi tokens qualify as securities under the Howey Test, which examines whether an investment involves money invested in a common enterprise with an expectation of profits from the efforts of others. When DeFi tokens meet this definition, their sale must comply with securities registration requirements or qualify for an exemption.
DeFi fraud violates several categories of law:
| Legal Violation | Description | Penalties |
|---|---|---|
| Securities Fraud | Selling unregistered securities or making material misrepresentations about investment offerings | Civil penalties, disgorgement of profits, criminal prosecution up to 20 years |
| Wire Fraud | Using electronic communications to execute fraudulent schemes | Up to 20 years imprisonment, fines up to $250,000 |
| Money Laundering | Concealing the source of illegally obtained funds through DeFi protocols | Up to 20 years imprisonment, fines up to $500,000 |
| Computer Fraud | Unauthorized access to computer systems or exceeding authorized access | Up to 10 years imprisonment for first offense |
Several high-profile prosecutions demonstrate that anonymity on the blockchain does not protect fraudsters from law enforcement. The founders of the Frosties NFT project were charged with wire fraud and money laundering after conducting a rug pull. The Department of Justice has established a dedicated Cryptocurrency Enforcement Team specifically to combat criminal misuse of digital assets.
Regulatory Response to DeFi Fraud
Multiple regulatory agencies have jurisdiction over different aspects of DeFi investment fraud. The SEC regulates securities offerings, including many DeFi tokens. The Commodity Futures Trading Commission oversees cryptocurrency derivatives and commodity trading. The FBI’s Internet Crime Complaint Center investigates fraud complaints. The Financial Crimes Enforcement Network monitors money laundering through virtual currency exchanges.
In 2025, regulatory enforcement accelerated significantly. According to FinCEN, the securities and futures industry filed more than 61,000 suspicious activity reports in both 2022 and 2023, with the number of filings doubling in the previous five years. The FBI reports that investment fraud remains the costliest type of crime tracked, with $5.7 billion in investment fraud losses and $1.42 billion specifically in crypto-related scams.
Recent SEC Enforcement Actions
The SEC has taken multiple enforcement actions against DeFi platforms and their operators. In a landmark case, the SEC charged a DeFi lending platform and its executives for raising $30 million through fraudulent offerings using smart contracts. The commission alleged that the operators made materially misleading statements while failing to register their securities offerings.
These enforcement actions establish important precedents: DeFi technology does not exempt projects from securities laws, and the SEC will pursue fraudulent operators regardless of decentralization claims.
California’s Department of Financial Protection and Innovation has also increased scrutiny of cryptocurrency platforms operating in the state. California maintains additional consumer protection requirements that may provide victims with state-level remedies beyond federal enforcement.
Legal Recourse for DeFi Fraud Victims
Victims of DeFi investment fraud have several potential paths to pursuing restitution, though success requires prompt action and realistic expectations. While blockchain transactions cannot be reversed, legal mechanisms exist to identify perpetrators, freeze assets, and obtain restitution.
Civil Litigation
If the scam operator can be identified, victims may pursue civil lawsuits for fraud, breach of contract, and violation of securities laws. Civil litigation offers several advantages including the ability to seek compensatory damages, punitive damages in cases of egregious conduct, and disgorgement of profits. However, civil cases require identifying the defendant’s true identity and locating assets to satisfy any judgment.
Regulatory Complaints
Filing complaints with the SEC, CFTC, or state securities regulators triggers investigations that may lead to enforcement actions. Regulatory proceedings can result in cease and desist orders halting ongoing fraud, asset freezes preventing further dissipation of stolen funds, civil penalties, and disgorgement of ill-gotten gains that may be distributed to victims through a Fair Fund.
Criminal Referrals
Reporting DeFi fraud to the FBI’s Internet Crime Complaint Center (IC3) creates a record that may support criminal prosecution. While victims cannot control whether charges are filed, criminal cases can lead to restitution orders requiring convicted defendants to repay victims, imprisonment that prevents further fraud, and public awareness that protects other potential victims.
Blockchain Forensics
Specialized blockchain analysis firms can trace stolen cryptocurrency through multiple transactions and wallets. While this does not directly recover funds, blockchain forensics can identify the ultimate destination of stolen assets, support civil or criminal cases with evidence, reveal connections to centralized exchanges where assets can be frozen, and establish patterns of conduct useful in litigation.
Legal Remedies
- Civil lawsuits against identified perpetrators
- SEC enforcement actions and Fair Funds
- CFTC reparations proceedings
- Criminal restitution orders
- State consumer protection claims
- Class action litigation for widespread scams
Technical Recovery Methods
- Blockchain forensics to trace stolen funds
- Asset freezes at centralized exchanges
- Smart contract exploits to recover funds (in limited cases)
- Emergency injunctions to prevent asset dissipation
- International cooperation for overseas perpetrators
- Collaboration with affected DeFi protocols
How a Securities Attorney Can Help and the Challenges of Recovery
Recovering from DeFi investment fraud requires both legal expertise and technical understanding of blockchain technology. An attorney experienced in securities fraud and cryptocurrency cases can provide critical assistance that significantly improves prospects for holding fraudsters accountable.
A securities attorney helps DeFi fraud victims in several ways. First, conducting thorough investigations using blockchain forensics to trace stolen funds and identify perpetrators through transaction patterns. Second, engaging with regulatory agencies by filing detailed complaints with the SEC, CFTC, and other agencies, providing evidence that supports enforcement actions, and monitoring regulatory proceedings for opportunities to claim victim status in Fair Funds.
Third, pursuing civil litigation by drafting complaints that clearly explain technical aspects to courts, seeking emergency relief including asset freezes and temporary restraining orders, conducting discovery to uncover additional evidence and assets, and negotiating settlements when appropriate. Fourth, coordinating with law enforcement by making criminal referrals with supporting evidence, assisting prosecutors in understanding complex DeFi schemes, and advocating for victim restitution in criminal cases.
Gary Varnavides brings unique qualifications to DeFi investment fraud cases. His decade of experience at Sichenzia Ross Ference LLP defending broker-dealers provided insider knowledge of how financial institutions and their representatives operate. This background translates directly to understanding DeFi fraud, as many schemes mirror traditional securities violations executed through new technology.
Recognition as a Super Lawyers Rising Star from 2015-2023 demonstrates peer recognition of his securities litigation expertise. Licensed to practice in California, New York, and New Jersey, Gary can pursue cases across multiple jurisdictions where many cryptocurrency platforms operate.
Understanding the Challenges
Victims deserve honesty about the difficulties of recovering funds lost to DeFi investment fraud. While legal recourse exists, several factors make obtaining restitution challenging and often incomplete.
The irreversible nature of blockchain transactions means that unlike credit card fraud or bank fraud, there is no financial institution that can reverse unauthorized transactions. Once cryptocurrency leaves your wallet, only voluntary return or court-ordered restitution can recover it. Many DeFi fraudsters operate anonymously or under pseudonyms, making it difficult to identify defendants for legal action. Even when investigators trace funds, connecting specific individuals to wallet addresses requires substantial evidence.
International jurisdiction creates additional obstacles. Perpetrators often operate from countries with limited cooperation with U.S. law enforcement or weak enforcement of financial crimes. Even successful judgments may prove impossible to enforce across borders. Asset dissipation happens quickly. Stolen cryptocurrency can be laundered through mixers, decentralized exchanges, and privacy coins within hours of a rug pull, making restitution efforts a race against time.
Realistic Recovery Expectations
Based on current enforcement patterns, victims should understand likely outcomes. Full restitution remains rare absent early detection and swift asset freezes. Partial restitution becomes possible through regulatory enforcement actions that create Fair Funds or criminal restitution. Preventive value exists even when obtaining restitution fails, as complaints contribute to enforcement actions that stop ongoing fraud and protect other investors.
Early action dramatically improves the prospects for restitution. Victims who report fraud within 24-48 hours have significantly better outcomes than those who wait weeks or months.
Despite these challenges, pursuing legal action serves important purposes beyond individual restitution. It creates a record that supports pattern evidence in larger cases. It contributes to regulatory enforcement that may eventually reach the fraudsters. It may identify assets that can be frozen before complete dissipation. It sends a message that DeFi fraud has consequences even when individual restitution proves difficult.
Immediate Steps After Discovering DeFi Fraud
If you believe you have been the victim of DeFi investment fraud, taking immediate action can preserve evidence and improve prospects for holding fraudsters accountable.
- Stop all interactions with the platform: Do not make additional deposits or attempt to withdraw funds, as this may trigger theft mechanisms or complicate evidence
- Document everything: Take screenshots of the platform, all communications, your transaction history, wallet addresses involved, and any promotional materials or whitepapers
- Save all evidence: Export transaction data from your wallet, preserve email and social media communications, record URLs before websites disappear, and save copies of smart contracts if accessible
- Report to authorities: File a complaint with the FBI’s Internet Crime Complaint Center at IC3.gov, submit a complaint to the SEC at SEC.gov/tcr, report to your state securities regulator, and notify local law enforcement
- Notify exchanges: If you can identify where stolen funds went, contact any centralized exchanges involved and request asset freezes
- Consult a securities attorney: Early legal advice can identify time-sensitive actions and preserve legal remedies
- Do not attempt self-help actions: Avoid “help services” that may be additional scams, and do not engage in any illegal hacking or unauthorized access attempts
Time is critical in DeFi fraud cases. Evidence disappears as websites go offline, social media accounts delete, and smart contracts become harder to access. Stolen funds move through multiple wallets and exchanges, becoming progressively harder to trace. Regulatory agencies prioritize cases with fresh evidence and clear documentation. Opportunities to freeze assets at centralized exchanges close within days or even hours.
AI-Powered DeFi Scams: An Emerging Threat
Artificial intelligence has dramatically amplified the sophistication and profitability of DeFi fraud. According to Chainalysis, AI-enabled scams in 2025 were 4.5 times more profitable than traditional scams, extracting an average of $3.2 million per operation compared to $719,000 for non-AI scams.
AI enhances fraud in several ways. Deepfake technology creates convincing video endorsements from crypto influencers or celebrities who never actually promoted the project. In 2025 alone, deepfake crypto scams caused over $200 million in losses. One scam used a deepfake video of a popular crypto YouTuber to promote a fake giveaway, collecting over $500,000 in “entry fees.”
Chatbots and automated engagement create the illusion of active communities and responsive customer support. AI generates professional-looking whitepapers and technical documentation that appear legitimate to non-expert readers. Automated trading bots manipulate prices to create the appearance of organic growth and trading volume.
The sophistication of AI-powered fraud makes technical due diligence even more critical. Even experienced investors struggle to distinguish AI-generated content from legitimate materials. This evolution reinforces the importance of verification through multiple independent sources, prioritizing projects with established reputations and proven track records, and consulting with experts before making significant DeFi investments.
Why Choose Varnavides Law for DeFi Fraud Cases
DeFi investment fraud sits at the intersection of securities law and emerging technology. Successfully pursuing these cases requires understanding both traditional fraud principles and the technical mechanics of blockchain, smart contracts, and cryptocurrency.
Gary Varnavides spent 10 years at Sichenzia Ross Ference LLP defending broker-dealers and financial professionals against securities fraud allegations. This experience defending the financial industry provides insight into how fraud operates, what evidence prosecutors and plaintiffs need to succeed, how financial institutions attempt to avoid liability, and which legal strategies prove most effective.
This background translates directly to DeFi fraud cases because the fundamental fraud schemes mirror traditional securities violations, just executed through new technology. The legal analysis under securities laws applies whether fraud occurs through a brokerage firm or a DeFi protocol. Recovery strategies require understanding both legal remedies and financial industry practices.
Recognized as a Super Lawyers Rising Star from 2015-2023, placing him among the top 2.5% of attorneys in the New York Metro area, Gary focuses his practice on investor protection and securities litigation. Licensed to practice in California, New York, and New Jersey, he can pursue cases across the jurisdictions where many cryptocurrency platforms operate or maintain offices.
Most importantly, Gary provides realistic assessments of cases. He will not make promises about guaranteed obtaining restitution or overstate the likelihood of success. DeFi fraud cases present significant challenges, and clients deserve honest analysis of their options, prospects, and the costs involved in pursuit of obtaining restitution.
Frequently Asked Questions
Can I recover my cryptocurrency after a DeFi rug pull?
Recovery depends on several factors including how quickly you act, whether the perpetrators can be identified, and whether stolen funds reached exchanges where they can be frozen. While complete obtaining restitution remains rare, partial obtaining restitution occurs through regulatory enforcement actions, criminal restitution, or civil settlements. Early action within 24-48 hours significantly improves prospects. Blockchain forensics can trace stolen funds, and attorneys can seek emergency asset freezes. Even when full obtaining restitution proves impossible, legal action contributes to enforcement that may eventually reach the fraudsters and protect other investors.
Is DeFi fraud illegal if it happens on decentralized platforms?
Yes, DeFi fraud is unequivocally illegal under federal and state laws. The fact that fraud occurs through blockchain technology and smart contracts does not exempt it from securities laws, wire fraud statutes, or money laundering regulations. The SEC has established that many DeFi tokens qualify as securities and must comply with registration requirements. DeFi fraudsters face criminal prosecution for wire fraud (up to 20 years), money laundering (up to 20 years), securities fraud, and computer fraud. The Department of Justice has successfully prosecuted several DeFi scam operators, including the founders of the Frosties NFT project who were charged with wire fraud and money laundering.
What should I do immediately after discovering I’ve been scammed?
Take these immediate steps: (1) Stop all interactions with the platform and do not make additional deposits. (2) Document everything including screenshots of the platform, transactions, communications, and promotional materials. (3) Export transaction data and wallet addresses involved. (4) File reports with the FBI’s Internet Crime Complaint Center at IC3.gov, the SEC at SEC.gov/tcr, and your state securities regulator. (5) Notify any centralized exchanges where stolen funds may have gone and request asset freezes. (6) Consult a securities attorney quickly, as early legal advice can identify time-sensitive actions. Do not use “obtaining restitution services” that contact you after a scam, as many are additional scams targeting victims.
How do attorneys trace cryptocurrency after a DeFi scam?
Attorneys work with blockchain forensic specialists who analyze the public blockchain to trace stolen cryptocurrency through multiple transactions and wallets. While blockchain transactions are pseudonymous rather than anonymous, forensic tools can follow funds as they move between addresses, identify connections to centralized exchanges where KYC information exists, reveal patterns that indicate money laundering techniques, and ultimately determine where stolen funds currently reside. This evidence supports civil litigation, regulatory complaints, and criminal referrals. When traced funds reach a centralized exchange, attorneys can seek court orders to freeze assets. The analysis also helps identify the perpetrators by connecting wallet addresses to real-world identities through exchange accounts, IP addresses, and transaction patterns.
Can the SEC help me seek restitution lost in a DeFi scam?
The SEC can pursue enforcement actions against DeFi fraudsters that may eventually benefit victims. When the SEC successfully brings enforcement actions, it can obtain disgorgement of ill-gotten gains, which may be distributed to victims through a Fair Fund. The SEC can also obtain civil penalties and issue cease and desist orders stopping ongoing fraud. However, SEC enforcement focuses on deterrence and market protection rather than individual victim obtaining restitution. Victims should file complaints with the SEC to trigger investigations, but also pursue parallel remedies including civil litigation and criminal referrals to the FBI. SEC actions typically take months or years to resolve, making early private legal action important for preserving evidence and pursuing time-sensitive remedies like asset freezes.
Are yield farming platforms with high returns always scams?
Not all yield farming platforms with high returns are scams, but extreme caution is warranted. Legitimate DeFi protocols can offer returns significantly higher than traditional investments during certain market conditions, but sustainable returns rarely exceed 10-20% annually. Red flags indicating potential fraud include guaranteed returns exceeding 50-100% annually, promises of consistent returns regardless of market conditions, unaudited smart contracts or audits from unknown firms, anonymous development teams without verifiable credentials, pressure to invest quickly before “missing out,” and no clear explanation of how returns are generated. Even legitimate yield farming carries significant risks including impermanent loss, smart contract vulnerabilities, and market volatility. Before investing, verify independent third-party audits, research the development team’s track record, understand the economic model generating returns, and never invest more than you can afford to lose.
What is the difference between a DeFi scam and a failed project?
Intent separates fraud from failure. A failed project attempted to build something legitimate but encountered technical challenges, market conditions, regulatory issues, or business difficulties that prevented success. The developers maintained transparency, attempted to solve problems, and did not misappropriate investor funds. In contrast, a DeFi scam involves intentional deception designed to steal investor money from the outset. Key indicators of fraud include sudden disappearance of developers and online presence, misrepresentations about the project’s technology or team, hidden code in smart contracts designed to steal funds, immediate transfer of investor funds to developers’ wallets, and no genuine attempt to build the promised product. Legally, this distinction matters because fraud supports criminal charges and civil claims, while business failure typically does not create legal liability absent misrepresentation or breach of fiduciary duty.
How long do I have to take legal action after a DeFi scam?
Statutes of limitations vary by jurisdiction and type of claim, but prompt action is critical regardless of legal deadlines. For securities fraud claims, the statute of limitations is generally two years from discovery of the fraud or five years from the fraud occurrence, whichever is earlier. For wire fraud claims, the federal statute of limitations is five years. For state consumer protection claims, limitations periods range from one to six years depending on the state. However, practical considerations make immediate action essential. Evidence disappears quickly as websites go offline and social media accounts delete. Stolen cryptocurrency moves through multiple wallets and becomes harder to trace. Opportunities to freeze assets at exchanges close within days. The sooner you act, the better your the prospects for restitution regardless of legal deadlines.
Take Action: Free Consultation for DeFi Fraud Victims
If you have lost money in a DeFi investment fraud, rug pull, yield farming scam, or other cryptocurrency fraud, time is critical. Every day that passes makes obtaining restitution more difficult as evidence disappears and stolen funds move through increasingly complex laundering schemes.
Protect Your Rights After DeFi Fraud
Gary Varnavides brings a decade of securities litigation experience and technical understanding of blockchain technology to help DeFi fraud victims pursue obtaining restitution. Schedule a free consultation to discuss your case, understand your legal options, and determine the best path forward.
We handle most securities fraud cases on a contingency fee basis, meaning you pay no attorney fees unless we seek restitution for you. Fee arrangements are discussed during your free consultation.
Do not let the technical complexity of DeFi fraud prevent you from pursuing justice. While obtaining restitution presents challenges, victims who act quickly and work with experienced securities attorneys have the best prospects for holding fraudsters accountable and recovering at least a portion of their losses.
