Canadians Are Having Crypto Stolen From Their Homes, Police Say

Canadian neighborhoods are being plagued by a wave of home-invasion style robberies in search of wealthy crypto investors’ private keys, according to local police. 

According to the Royal Canadian Mounted Police (RCMP)’s website, a warning has been issued by police in Richmond and Delta about the rising trend, as “several robberies” of this nature have occurred. 

Investigations are still ongoing, and police have not provided details regarding specific incidents, or the amount of cryptocurrency that’s been stolen. Police are also yet to determine whether there’s a link between individual incidents, though a “discernible pattern” is emerging between each, authorities have said.

“In each of the cases, the suspects gain access to a victim’s home by posing as delivery people or persons of authority,” the RCMP stated. “Once let inside the home, the suspects rob the victims of information that gives access to their cryptocurrency accounts.”

The physical nature of the theft stands in sharp contrast to the more common sorts of crypto crime in the industry, such as online scams and ransomware attacks. Such criminals usually leverage the pseudonymity of blockchain networks and the irreversibility of transactions—and typically do so from a distance.

Whereas hackers may be able to exploit a DeFi protocol to steal millions in crypto from its users, crypto funds are rarely physically seized. This is because crypto investors largely keep crypto funds either in custodial wallets (behind a password), non-custodial wallets (the sort that require users to memorize a 12-word seed phrase), or a hardware wallet that offers added security.

But many hardware wallet providers encourage people to keep backup versions of their seed phrase on a piece of paper, giving thieves something to look for when they break into someone’s house. 

Ironically, the advice from police for worried crypto owners is to trust in centralization: “Keep your valuables and financial information in a safe location, like a safety deposit box at a financial institution,” wrote the RCMP. 

Earlier this month, a Bitcoin developer released a tool called BIP39Colors, allowing Bitcoin holders to disguise their seed phrase as a series of colors. This could theoretically allow investors to hide their crypto in a less obvious manner, rather than as a clear list of words.