Crypto thieves in London are stealing phones to drain wallets, often within hours

Crypto users in London are getting cleaned out not by hackers in hoodies or some offshore scammer, but by guys on foot, right on the street, in person. They just need your phone, and once they’ve got it, your whole wallet is gone, no matter how secure you thought it was.

According to the Financial Times, a guy called Christian d’Ippolito was heading home in the early hours near Old Street when four men approached him. One of the men snatched his phone and jumped into a getaway car. That was the start, but within hours, his crypto wallet was drained, nearly £40,000 gone.

Thieves drain crypto wallets while police fall behind

“It felt completely out of my control,” Christian said, adding that the theft made him question whether he should even keep doing his charity work. But his case wasn’t special. These kinds of thefts are happening more and more across London, and the cops can’t keep up.

Most people store almost every detail of their identity on their phones; passport photos, passwords, and two-factor codes. One moment of distraction on the street and a thief has your phone, your crypto, your life.

Scott Pounder, a guy who used to work for the Met Police, now he works at Token Recovery, helping people who’ve had their crypto stolen. He said robbers are aggressively betting on the odds that the average young guy out late in London probably owns crypto.

And according to their data, one in four people between 18 and 34 in the UK own some crypto. Men are three times more likely than women to have it. That’s who these thieves are watching.

Neil Kotak, another victim, said he was also walking home after a night out when a group of men stopped him. “They seemed pretty friendly, we were just talking,” he said.

One of them asked for his number. “I logged in. At that point, they just grabbed my phone.” He lost £10,000 from his Coinbase and Binance accounts. His bank accounts were untouched.

Neil tried to disable the phone using a friend’s device, but he couldn’t remember his Apple ID. By the time he figured it out, his crypto was already being drained. Same with Christian, who said the robbers managed to reset his entire Apple ID.

“I don’t know how they worked around this,” he said. And he’s no beginner. He used to promote a crypto platform based in Singapore and had biometric security set up for every transaction.

Victims get refunds but cops make no progress

Surprisingly, Neil and another victim, Alec Burns, were reimbursed by Coinbase without any explanation. Coinbase pointed to its terms and said they aren’t liable for lost credentials.

But that’s all they said. Neil’s stolen Binance funds haven’t been returned. He said he hasn’t heard anything back from the exchange.

Phil Ariss, who used to work for the City of London Police and now works at blockchain intelligence firm TRM Labs, said the idea that stolen crypto can’t be tracked is just false. “When they do investigate [crypto theft], they investigate it exceptionally well,” he said. TRM sells software that helps police trace blockchain activity.

But most of the time, no one investigates at all. Phil said criminals usually cash out quickly through physical exchanges. And at the high end, there are ways to hide the money. He pointed to the $1.5 billion stolen by North Korean hackers from a Dubai-based exchange. A chunk of that has already been cashed out.

Back in London, Alec says the cops haven’t done a thing. He lost around $40,000 in crypto. He said the wallets used to move his stolen funds are linked to known entities. But that didn’t help.

“After all that’s happened, I can understand why so many people move to places like Dubai,” Alec said on his podcast, Untangling Web3, adding that he thinks the robbers are either waiting for better ways to move the crypto or for him to stop watching. “In 10 years, I probably won’t be watching that account,” he said.

Scott, the ex-cop, said he’s reported 20 crypto thefts to Action Fraud, the UK’s official reporting center for cybercrime. None of the cases were picked up by the police.

Met Police put out general advice: enable anti-theft features on phones, use strong passwords for every app, and always keep an eye on your screen in public. TRM Labs runs chainabuse.com, where people can report stolen crypto so it can be flagged and possibly blocked from being cashed out.

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