“Pig-butchering” cryptocurrency scammers have swiped a staggering $75 billion from investors’ digital wallets — and the massive theft is mostly being orchestrated by overseas criminal networks that are hard to police, according to a recent study.

The fraud surged during the pandemic and involves scammers — the “butchers” — initiating conversations with what initially appears to be a wrong-number text message, according to John Griffin, a finance professor at the University of Texas at Auston who, along with graduate student Kevin Mei, gathered crypto addresses from more than 4,000 victims.

There’s then a period of “fattening up” victims by continuing a text exchange to establish a close relationship, which often involves stock images of men or women to trick people into thinking they’re communicating with a real, harmless person, according to anti-malware software company Malwarebytes.

Once the victim places enough trust in the scammer, they’re asked to wire money into a seemingly legitimate crypto wallet and roped into an investment scheme that “butchers” them financially.

Once victims send enough funds, the scammers disappear, according to Bloomberg, which earlier reported on the study.

Griffin and Mei used blockchain-tracing tools to track the flow of funds from victims to scammers — many of which are based in Southeast Asia — and found that from January 2020 through February 2024, the criminal networks moved at least $75.3 billion to crypto exchanges.

The investments, however, are fake, per the study, dubbed “How Do Crypto Flows Finance Slavery? The Economics of Pig Butchering.”

According to the research, scammers “interact freely with major crypto exchanges, sending over 104,000 small potential inducement payments to build trust with victims.”

Roughly 84% of the funds are transacted in Tether — a popular stablecoin, a reference asset whose value is pegged.

Some $15 billion of the stolen cash came from five exchanges, according to Griffin and Mei — including Bitcoin, which can now be tracked on US-listed exchange traded funds, as well as Coinbase, the United States’ largest crypto exchange platform by trading volume.

“These are large criminal organized networks, and they’re operating largely unscathed,” Griffin told Bloomberg, noting that a portion of the funds could represent proceeds from other criminal activities.

Tether CEO Paolo Ardoino called the report false and misleading, according to Bloomberg.

“With Tether, every action is online, every action is traceable, every asset can be seized and every criminal can be caught,” Ardoino said in a statement to the outlet. “We work with law enforcement to do exactly that.”

Though Tether has frozen accounts tied to fraud at authorities’ recommendation, Bloomberg reported, often times the scammers have cashed out by the time the crime is reported.

“Our paper shows they’re the currency of choice for criminal networks,” Griffin said.

These scammers, though, are often victims themselves — of human trafficking schemes across Southeast Asia, where an estimated 150,000-plus people are trafficked annually, according to the United Nations Office on Drugs and Crime.

Trafficking victims are lured to compounds in countries including Cambodia and Myanmar under the guise that they’re taking high-paying jobs, for example, but then are trapped, forced to scam and sometimes beaten and tortured, according to Bloomberg.

Without blockchains — which make use of decentralized networks — “you’d have to go through banks and follow ‘know-your-customer’ procedures. Or you’d have to put cash in bags” in order to scam people out of that much money, Griffin told Bloomberg,

“In the old days, it would be extremely difficult to move that much cash through the financial system,” Griffin added.

The professor reportedly used Norwegian crypto investigations firm Chainbrium to collect victims’ blockchain addresses.

“People in the US, their money is going straight to Southeast Asia, into this underground economy,” Jan Santiago, a consultant to Chainbrium, told Bloomberg.