Getting Away With It

The Crypto Wild West

In the early days of crypto, you could get away with almost anything. The lack of regulation created a playground for scammers, fraudsters, and opportunists.

The Golden Age of Scams

Exit Scams

• How it worked: Launch a project, raise money, disappear
• Why it worked: No regulatory oversight, anonymous teams
• Classic examples: BitConnect, OneCoin, PlusToken

Pump and Dumps

• How it worked: Accumulate cheap tokens, shill heavily, dump on retail
• Why it worked: Unregulated markets, information asymmetry
• Modern version: "Influencer" pumps on social media

Ponzi Schemes

• How it worked: Promise high returns, pay old investors with new money
• Why it worked: Greed, lack of financial education
• Crypto twist: Use blockchain to appear legitimate

The Regulatory Vacuum

Why Regulation Was Slow

• Technical complexity: Regulators didn't understand the technology
• Jurisdiction issues: Global nature of blockchain
• Resource constraints: Limited regulatory budgets
• Industry lobbying: Crypto companies fought regulation

What Was Missing

• KYC/AML requirements: Anonymous transactions
• Securities laws: Token sales operated in gray area
• Consumer protection: No recourse for victims
• Market manipulation: No insider trading rules

Famous "Get Away With It" Stories

The Mt. Gox Hack

• What happened: 850,000 Bitcoin "disappeared"
• Who got away: CEO Mark Karpelès initially avoided serious consequences
• Lesson: Even exchanges can't be trusted

The DAO Hack

• What happened: $50 million drained from smart contract
• How they got away: Hacker kept the funds legally
• Resolution: Ethereum forked to reverse the hack

BitConnect

• What happened: $2.5 billion Ponzi scheme
• Who got away: Promoters scattered before collapse
• Aftermath: Some faced charges, but most kept their money

Why People Got Away With It

Technical Factors

• Anonymity: Pseudonymous transactions
• Irreversibility: No chargebacks or refunds
• Jurisdiction hopping: Move operations to friendly countries
• Code is law: Exploit legal gray areas

Social Factors

• Community defense: "To the moon" cult mentality
• Victim blaming: "Should have done your own research"
• Normalization: "Everyone's doing it"
• Complexity: Too technical for average person to understand

Legal Factors

• Slow courts: Legal system moves at glacial pace
• New territory: No existing legal precedents
• Cross-border issues: International coordination problems
• Resource limits: Regulators overwhelmed

The Changing Landscape

Regulation is Coming

• SEC crackdown: Security token classifications
• International coordination: Global AML standards
• Exchange compliance: KYC becoming mandatory
• Law enforcement expertise: Crypto-savvy investigators

What's No Longer Possible

• Anonymous exchanges: Most require verification
• Unregistered securities: Token sales face scrutiny
• Market manipulation: Insider trading enforcement
• Cross-border crime: International cooperation

The New "Getting Away With It"

While obvious scams are harder, sophisticated fraud continues:

Rug Pulls 2.0

• DeFi exploits: Smart contract vulnerabilities
• Liquidity manipulation: AMG attacks
• Governance attacks: Proposal manipulation

Regulatory Arbitrage

• Jurisdiction shopping: Operate from crypto-friendly countries
• Compliance theater: Appear compliant while evading
• Decentralization washing: Hide centralization behind DAOs

The Lesson

The crypto wild west is being tamed, but the fundamental cat-and-mouse game between innovators and regulators continues. The methods evolve, but the human greed and fear that drive scams remain constant.

The best protection? Education, skepticism, and never investing more than you can afford to lose.