The multibillion-dollar crypto fraud known as “pig-butchering” is no longer just a consumer issue — experts now warn it poses a threat to national security.

In a recent podcast, Andrew Fierman, head of national security intelligence at Chainalysis, and Erin West, former prosecutor and founder of anti-scam nonprofit Operation Shamrock, discussed the growing scale and sophistication of these scams.

“So if anybody is touching money in any way, you’re part of this. You need to be prepared to understand the threat and the gravity of what’s happening on a national security level,” West said.

What Is a Pig-Butchering Scam?

A pig-butchering scam is a long-term fraud strategy where criminals build trust with a victim — often through romance or friendship — before steering them toward fake cryptocurrency investment platforms and draining their funds.

These scams have evolved into transnational criminal operations, often combining human trafficking, money laundering, and crypto rails, making them far more complex than typical fraud.

Scale and Impact

• Fraud rings, primarily across Southeast Asia, operate dormitory-style scam compounds, where trafficked workers contact unsuspecting victims to gain trust and extract funds.
• In 2023, the U.S. Department of Justice seized roughly $112 million linked to pig-butchering scams.
• According to a February 2025 report by Chainalysis, pig-butchering scams increased nearly 40% year-over-year in 2024, while overall crypto scam revenue exceeded $9.9 billion.
• Victims are often targeted twice, with fake recovery firms approaching them after the initial scam.

“Once this happens to you, you will be put on a list […] and you are even more likely to get hit up again,” West warned.

Blockchain as a Tool for Disruption

Fierman highlighted blockchain’s transparency as a potential tool for regulators, exchanges, and virtual asset service providers (VASPs) to combat these scams.

“The transparency of the blockchain gives the opportunity to potentially disrupt at the point of cash out,” he said.

Authorities Respond

Governments and law enforcement are stepping up to address the threat:

• On Nov. 12, the DOJ announced a “Scam Center Strike Force” to target Chinese-linked transnational criminal organizations behind crypto investment fraud in Southeast Asia.
• Regional law enforcement, in collaboration with Chainalysis, OKX, Tether, and Binance, froze $47 million in pig-butchering funds in the Asia Pacific region on Aug. 27, 2025.

West emphasized the need for a comprehensive approach: sanctions, indictments, and diplomatic pressure are all critical tools.

Red Flags for Victims

Victims can look out for common pig-butchering tactics:

• Sudden expressions of strong feelings online without in-person meetings.
• Refusal to share personal or professional credentials.
• Requests for money under the guise of emergencies or risk-free investment opportunities.
• Fake screenshots of large profits to lure investments.

“Use every tool in our arsenal,” West said, emphasizing the importance of vigilance and education in combating these sophisticated scams.