The dangerous trend of criminals targeting crypto owners with physical attacks is gaining momentum. These attacks, often called “wrench attacks,” happen when thieves force people to hand over access to their digital money through threats or violence.
Last month in New York, a scary situation unfolded when armed robbers broke into a home. They tied up the family and demanded the passwords to their cryptocurrency accounts. The thieves got away with millions in digital assets that may never be recovered.
Unlike regular money kept in banks, cryptocurrency sits in digital wallets that only the owner can access. This makes crypto owners walking targets for criminals looking for a big score. The problem has gotten worse as more regular people invest in digital currencies like Bitcoin and Ethereum.
“It’s the perfect crime,” says blockchain security expert Maya Rodriguez. “Once criminals transfer the funds, they’re basically impossible to trace or recover. Traditional banks have protections that cryptocurrency simply doesn’t.”
Police departments across the country report growing numbers of these incidents. The FBI’s cyber division created a special task force last year just to handle crypto-related robberies. Their data shows a 64% increase in physical crypto theft cases since 2021.
What makes these attacks different is how criminals pick their targets. They look for people who post about their crypto success online or who work in the industry. Sometimes they even track luxury purchases that might signal crypto wealth.
The most common attack happens at home, where thieves can take their time forcing victims to transfer funds. Some criminals have even kidnapped victims and held them until payments cleared through the blockchain.
Security experts suggest several ways crypto owners can protect themselves. First, never talk about your holdings online or in public. Second, consider keeping most of your assets in “cold storage” — devices not connected to the internet. Finally, set up emergency measures like duress passwords that only transfer small amounts while alerting authorities.
Some crypto users now use special wallets with decoy accounts. These show smaller balances if someone forces you to open them. The main funds stay hidden in secret accounts that don’t appear during a robbery.
“I keep a small amount in my regular wallet and the rest locked away,” says Jamie Chen, a crypto investor who changed his security after a friend was attacked. “I also stopped posting anything about my investments online. It’s just not worth the risk.”
Law enforcement faces unique challenges when investigating these crimes. Digital currencies move across borders instantly, making recovery nearly impossible once the transfer completes. Victims often can’t identify their masked attackers, and the anonymous nature of blockchain transactions creates dead ends for investigators.
Cryptocurrency exchanges are starting to help by flagging suspicious transfers, but thieves stay one step ahead by using mixing services that hide the money trail. These services jumble transactions together, making it nearly impossible to follow stolen funds.
The rise in physical attacks highlights how the crypto world still lacks the security protections of traditional banking. While digital assets offer freedom from government control, they also remove safety nets like fraud protection and theft insurance that most people take for granted.
Industry leaders are calling for better security education. Many suggest crypto owners use multisignature wallets requiring approval from multiple devices or people before moving large amounts. Others recommend specialized insurance policies now offered by companies that understand the unique risks of digital asset ownership.
As cryptocurrency becomes more mainstream, these security concerns will likely shape how the technology evolves. The industry faces pressure to create better protections while maintaining the privacy and independence that attracted users in the first place.
For now, crypto owners must take personal responsibility for their security. The old saying “don’t put all your eggs in one basket” applies more than ever. Spreading assets across different storage methods and keeping a low profile might be the best defense against criminals wielding both digital hacking tools and physical wrenches.
