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A Deep Dive into Cryptocurrency Recovery

A Deep Dive Into Cryptocurrency Recovery

Almost 4 million bitcoins have been lost forever. As of autumn 2022, that equates to around $66.5 billion in bitcoin, which is about 20% of the entire circulating amount. Because blockchain technology doesn’t use intermediaries like banks, users are entirely responsible for their assets making cryptocurrency recovery difficult. 

These losses can be for various reasons, from user error, broken hard drives, incorrect transactions, or even lost private keys. In some exceptional cases, centralized exchanges may get your funds back, but unfortunately, decentralized exchanges and wallets don’t have a helpline. This can be a bitter pill to swallow if you’re used to traditional finance.

Thankfully, there are ways to recover cryptocurrency. However, it’s a challenging task and not always guaranteed.

In this article, we will be discussing cryptocurrency recovery. We will explain how it works and the different methods available for recovering lost coins. We will also discuss how to work with a cryptocurrency recovery expert and some tips to help you recover your coins.

What is cryptocurrency recovery?

Cryptocurrency recovery is the process of retrieving lost or stolen cryptocurrency. This is generally done through the help of cryptocurrency recovery experts who are experienced in retrieving funds. However, it is important to note that not all cases of lost cryptocurrency can be recovered. For example, if funds have been scammed or stolen, there is no way to retrieve them.

How does crypto recovery work?

Because there are multiple ways you can lose your cryptocurrency, there are also multiple ways that cryptocurrency can be recovered.

Some of the most common types of recovery are seed phrase recovery and password recovery. Seed phrases are integral to accessing your wallet on other devices or if you’ve forgotten your password. Unfortunately, some people might misplace their seed phrase or forget to record it altogether. A seed phrase is typically a 12-24 word combination used to access your private key. These are recovered by attempting multiple password combinations using high-end hardware.

There are, of course, many other ways you might lose your cryptocurrency. These can be losses due to data corruption from older wallets, hardware failure, corrupted hardware, deleted data, or viruses. In these situations, the solution may need a more technical approach involving some computer science or blockchain knowledge.

Different kinds of cryptocurrency recovery

There are a few different types of cryptocurrency recovery methods that can be used to retrieve lost or stolen coins aside from simply recovering your seed phrase or password. Below are some examples of the best steps to get your cryptocurrency back.

Hot wallet issues

One of the more common recovery issues is associated with hot wallets. This generally refers to wallets that are stored on devices that are connected to the internet and include browser-based wallets like MetaMask. These wallets are often less secure than cold wallets and can be more susceptible to hacks. Common issues include losing or forgetting a password and/or the seed phrase.

  • If you have a hot wallet that is lost or stolen, the first step is to contact the company or service that provided the wallet. They may be able to help you recover your funds if you can prove ownership.
  • Another step you can take is to find your hot wallet’s private keys. These are typically stored on your computer or in your browser’s memory. If you can find these, you can use them to access your funds.
  • There’s also a possibility you can recover your funds by looking through your transaction history. You can do this by going through your blockchain explorer (something like Etherscan) or wallet provider. If you see any suspicious activity, you may be able to track down the thief and get your coins back.

Cold wallet issues

Cold wallets are wallets stored offline on devices that are not connected to the internet. They are considered more secure than hot wallets and less susceptible to hacks. If you have lost your login information or the device on which your cold wallet is stored has malfunctioned, there are things you can do to attempt recovery.

  • The first step is to contact the company or service that provided the wallet. As with hot wallets, they may be able to help you recover your funds if you can prove ownership.
  • Another step you can take is to try and find the seed phrase for your cold wallet. These would have been provided when you first set up your cold wallet so hopefully, you stored them in a safe place. If you can find it, you can use it to access your funds.

Smart contract crypto recovery

Depositing funds into a smart contract can be a great way to earn passive income. However, if the front end (website) goes down or is no longer supported by a team, then you might be left without an easy way to access or withdraw your funds. This means that it can become incredibly difficult to access your funds and may require coding knowledge.

  • First, try reaching out to the devs or mods on the project’s Discord server or Telegram group. They may be able to help or guide you on how to retrieve your funds. Again, NEVER give out your seed phrase or private key. If someone asks for it, they are most likely just trying to scam you.
  • In some cases, sites such as Etherscan will allow you to manually transact with a smart contract. You will need to know the smart contract address and the right commands to withdraw your funds.

Cross-chain recovery

Cross-chain recovery refers to the process of recovering cryptocurrencies sent to another network. This is done through bridges, or by mistake when someone sends crypto to an address that exists on another blockchain.

Bridges

Bridges pose a significant risk because they are more prone to security breaches and other losses or issues. Bridges are a peculiar situation because they technically operate across multiple blockchains. This allows you to deposit cryptocurrency on one blockchain and then get a similar amount (minus fees) on another. Unfortunately, sometimes things can go wrong during the transfer and you might not get your cryptocurrency. If that’s the case, here are a few things to try.

  • Most bridges have a Discord or Telegram group that can connect you to the developers or some kind of help chat. If you aren’t receiving your cryptocurrency then posting on these platforms can get you direct help. Warning: A common scam is to impersonate support or a project dev. NEVER give out your seed phrase to someone messaging you.
  • If you use a wallet like MetaMask or another wallet that can access multiple blockchains, you may have received your cryptocurrency but it may not appear because your wallet is set to the wrong blockchain. If you’re transferring funds to a new blockchain, you will need to set up the RPC and configuration for that blockchain in your wallet.

Wrong Network

Many people lose their crypto when they send funds to the wrong blockchain address. If you hold a token on the BNB blockchain and send it to an Ethereum address, the funds won’t transfer to the Ethereum blockchain.

  • Contact support, if you’re on a centralized exchange such as Binance, and explain the situation. In most cases, they will be able to return the funds.
  • If you’re using a decentralized wallet you will need to contact the person you sent funds to see if they will cooperate in recovering the funds.
  • Then you will need to access the private key to send the funds to a wallet that supports both blockchain networks.

Cryptocurrency scam recovery

This refers to recovering funds that were stolen through scams or fraudulent activities. Unfortunately, this is very common in the blockchain space and challenging to recover since scammers are not going to cooperate with you.

  • Contact the company or service that provided the wallet. While unlikely, they may be able to help you.
  • Document all the details you can. This means including your transaction ID and preparing a report detailing the incident. This will ensure you have as much information as possible to provide to any legal authorities or lawyers when pursuing the case.
  • With your information, you should report the scam to your local law enforcement agency. If they get enough reports, they can start an investigation. Since wallets and addresses are visible on the blockchain, it has been possible in the past for law enforcement to track down scammers and recover funds.

Working with a cryptocurrency recovery expert

When recovering your cryptocurrencies, it’s often best to work with a specialist. A cryptocurrency recovery expert will have the experience and knowledge to help you get your funds back.

They can assist with all recovery methods, including those mentioned above. They will also have access to the tools and resources that can be helpful in the recovery process.

When working with a cryptocurrency recovery expert, there are a few things you can expect. First, they will need all the relevant information about your incident. This includes the date, time, amount, and type of cryptocurrency lost. They will also need your transaction ID and wallet address, and any other identifying information.

The next step is for the expert to assess the situation and provide a plan of action. This may include contacting the company or service that provided the wallet, trying to find private keys, or looking through your transaction history.

Once the plan is in place, the expert will start recovering your funds. They will update you on their progress and notify you when the funds have been recovered.

How long does it take

You can expect the process to take some time. Depending on the situation, it may take a few hours or days to get your funds back. In more complex circumstances it might even take weeks. It all depends on your individual situation.

The expert will need time to gather all the relevant information and plan the recovery process. They will then need to carry out the recovery process itself, which can take additional time.

You should be patient and let the expert do their job. They will update you on their progress and notify you when the funds have been recovered.

How much does it cost?

The answer depends on a few factors, such as the type of recovery method used and how long the process takes. Generally speaking, you can expect to pay a consultation fee and/or a percentage of the recovered funds.

Be sure to discuss costs with the expert before hiring them so you know what to expect.

Is working with a cryptocurrency expert safe?

When working with a qualified expert, you can expect the process to be safe and secure. The expert will have the experience and knowledge to help you get your funds back.

They will keep all your information confidential and will take steps to protect your privacy. They will also work with you to ensure the recovery process goes as smoothly as possible.

If you are concerned about safety, discuss your concerns with the expert before hiring them. They will be able to put your mind at ease and explain how they will keep you and your information safe during the recovery process.

How to find a cryptocurrency expert

If you want the best chance of success, it’s crucial to find the right specialist. The ideal agent will have the experience, professionalism, and knowledge needed to help you get your funds back. Here are some tips and criteria you should look out for when finding a cryptocurrency expert.

How to find a cryptocurrency recovery expert

1. Do your research. There are many experts out there, so take the time to do your research and find one that is right for you. Look for an expert who has experience in the type of recovery you need. You should also look at their website. If they have in-depth information and a professional layout, it’s more likely they are qualified professionals.

2. Ask around. Talk to friends and family members who may have used a cryptocurrency recovery expert in the past. They may be able to recommend someone who can help you get your funds back. You can also search for referrals from other reputable businesses, this will give you solid evidence that the service works and the technicians are knowledgeable.

3. Check reviews. Once you’ve narrowed down your list of potential experts, be sure to check their reviews online. Remember that some scam websites might have fake reviews, so be leary. It’s always better to follow reviews by people you know.

4. Get quotes. Once you’ve found an expert you’re interested in working with, get quotes from them before making a decision. This will help you compare prices and services before making a final decision. If they’re asking for an unreasonable amount, this may be a red flag. Keep in mind the general price is about 20% commission but will be lower if your recovery amount is significant.

5. Ask questions. When interviewing potential experts, don’t be afraid to ask them questions about their experience, methods, and fees. If you can, get on a Zoom call or in-person meeting so you can get a feel of who is providing the service and whether or not you trust them. This will help you make an informed decision about who to work with and weed out those with insufficient experience.

By following these tips, you can increase your chances of finding a qualified cryptocurrency recovery expert who can help you get your funds back safely and securely.

Tips to protect your wallet and cryptocurrency

Of course, an ounce of prevention is worth a pound of cure. Looking for cryptocurrency recovery services should be your last line of defense. Use these tips to keep your funds safe and protected.

1. Use a hardware wallet. Hardware wallets are physical wallets activated only when the user has the wallet with them. They are the most secure way to store your cryptocurrency because they store your private keys offline, which makes them virtually theft-proof. Examples include the Ledger or Tezor wallet, with many cryptocurrency holders trusting these companies.

2. Only record your passwords physically. Anything that exists in a digital format is at risk of being stolen by hackers. So, never record your seed phrase electronically. Don’t email it to yourself (or anyone else, for that matter), don’t store it as a text file on any of your devices, and don’t take a picture of it. It’s essential to write it down and keep it in a safe place.

3. Never give your seed phrase or private key to anyone. If someone else has access to your passphrase or private key, they can steal your crypto and there is nothing you can do about it. This includes everyone from friends and family to support personnel on centralized exchanges. There shouldn’t be any reason to give your information to anyone. 

4. Use a non-custodial wallet. Non-custodial wallets give you control over your private keys, which means you don’t have to worry about losing them if the company goes out of business. This can be helpful during the cryptocurrency recovery process if someone has sent you coins over the wrong network. Since you have control, you’ll be able to locate the funds and send them back to the appropriate network.

5. “Not your keys, not your crypto.” This is a famous saying in the cryptocurrency community highlighting the importance of taking control of your assets. When storing funds on centralized exchanges, you’re not actually in control of your funds. There have been far too many examples of exchanges going insolvent and being unable to pay their customers or halting withdrawals.

Final Thoughts

Owning cryptocurrency is empowering and liberating. You have a store of value that offers a huge potential return on your investment and is free of control by centralized authorities. On the other hand, you don’t have the safety net offered by those institutions. 

So, when things go wrong, they can go very wrong, very fast. First, do everything you can to protect yourself. If that fails, you might need the services of a cryptocurrency recovery expert. If you do, collect as much information as you can, and find a professional you can trust to help you get your tokens back.