Crypto & Fintech · United States

DeFi Rug Pulls: How to Report the Fraud With On-Chain Evidence

Your local police department almost certainly can't trace a wallet on a permissionless network. The agencies that can need a specific kind of evidence — here's how to build it yourself.

Why Local Law Enforcement Usually Can't Help Directly

A "rug pull" — where token creators drain a liquidity pool or presale funds all at once, leaving investors with a worthless token — is a real crime, but it doesn't look like the crimes local police departments are equipped to investigate. The transactions happened on a public, permissionless blockchain, often across borders, frequently ending at an anonymous wallet with no obvious link to a real-world identity. Most local departments simply don't have blockchain forensics capability, and even if the crime is reported, it's likely to be filed and not actively pursued unless it connects to a larger, already-active investigation.

That doesn't mean there's no path forward — it means the report needs to go to agencies that actually have the tools and jurisdiction to act, and it needs a specific kind of evidence to be useful to them.

Building the On-Chain Evidence Trail

Before filing anything, use a blockchain explorer to document:

The distinction between funds that stayed in self-custodied wallets versus funds that touched a KYC'd exchange is often the single most important fact in whether a case can realistically be pursued — an exchange deposit is a potential identification point; a wallet that's never touched a regulated platform is much harder to trace to a real person.

Where to Actually File

File with more than one of these where the facts support it — they serve different roles, and a case that doesn't get individual attention at one agency may still contribute to a pattern that triggers a larger, multi-victim investigation.

What This Means for You

Document everything on-chain immediately — evidence on a public blockchain isn't going anywhere, but your ability to reconstruct the timeline from memory will fade fast. Don't wait for a "complete" case before filing; agencies often build larger cases by connecting multiple individual reports naming the same wallets or contracts.

Generate a formal complaint routed to the right agency for your situation, and use our blockchain explorer directory to build your evidence trail.

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