US Politicians May Have Fueled The Ongoing Crypto Scam, Theft Supercycle Zach XBT Says |

Key Insights:

• ZachXBT warns of a crypto “crime supercycle” fueled by political hype, weak regulation, and rogue influencers.
• The rise of meme coins and their endorsement from politicians is a major catalyst for these scams and pump-and-dump schemes.
• The rise in dismissed cases against crypto fraudsters hinders progress toward accountability.

Crypto investigator ZachXBT has sent out a warning this week about what he calls a “crime supercycle” within the crypto space.

Hacks, scams, thefts and even outright wrench attacks have taken over the crypto space, especially this year. Because of this, there are now concerns that the combination of political hype, slow regulation and unchecked influencer behavior is acting as fuel for the wave of criminal activity.

Even worse, the ongoing supercycle is shaping up to be unlike anything seen before in the industry. This year alone, hackers have stolen more than $2.1 billion from crypto platforms and users, through phishing scams, rug pulls, and other laundering operations. 

Here are the details of the alarms being sounded by influencers like ZachXBT and Taylor Monahan.

Meme Coins and Political Endorsements: The Tipping Point

One of the biggest catalysts for the ongoing crime wave, according to ZachXBT, is the rise of meme coins. This particularly includes those launched or endorsed by political figures within and outside the US, such as Donald Trump and Javier Milei. 

These coins, which are often hyped through social media and promoted without proper disclosure, have been a huge source of speculative capital within the crypto space.

The crime supercycle is indeed very real.

While it’s true the industry has historically been ripe for abuse it has noticeably increased since politicians launched meme coins and numerous court cases were dropped further enabling the behavior.

Laundering groups and small OTC… pic.twitter.com/jzQRTYeChO

— ZachXBT (@zachxbt) June 18, 2025

When combined with so little oversight, scenarios like these tend to result in major disasters. ZachXBT argues that politicians are lending legitimacy to meme coins, which has normalized risky and even fraudulent behavior. 

These moves have empowered a new generation of bad actors who use hype-driven tokens as vehicles for pump-and-dump schemes. They launch everything from fake presales and outright scams all while regulators look the other way.

“Since politicians launched meme coins and several court cases were dropped, criminal behavior has increased dramatically,” Zach XBT posted on X. “There’s never really been repercussions, so people feel free to exploit.”

Court Case Dismissals Undermine Accountability

Another major aspect of this problem is the increase in the number of dropped legal cases involving crypto-related fraud and misconduct. 

Zach XBT pointed out that courts often side with exploiters, especially when legal systems fail to fully understand what smart contracts and decentralized systems are. This lack of clear rules tends to make criminals more brazen, and influencers who promote scam tokens rarely face consequences, even when they fail to disclose paid endorsements.

 “Government agencies could’ve easily made $50–$100 million by fining influencers and projects who never disclosed paid ads,” ZachXBT wrote. “But instead, they went after open-source developers and legit protocols.”

Scams Are Getting Bigger, Bolder and Harder to Trace

Despite the transparent nature of blockchain technology, scammers are becoming more effective at covering their tracks.  

According to ZachXBT, money laundering groups have gained the upper hand.  For example, North Korea’s Lazarus Group, which is known for targeting crypto platforms, has allegedly laundered funds from several major hacks on exchanges like Bybit, DMM Bitcoin and WazirX.

I don’t see why things would change unless those who create new value (grow the pie) are rewarded more than those who extract value / move value in pointless circles.

The current incentives are driven primarily by the lack of risk around hacking/stealing/scamming/extracting. No…

— Tay 💖 (@tayvano_) June 18, 2025

ZachXBT estimates that the “Black U” market on the Tron blockchain is worth between $5 billion and $10 billion.

Interestingly,  much of it remains invisible to law enforcement and forensic analysts. While on-chain transparency helps track certain activities, the decentralized and borderless nature of crypto still makes it a perfect medium for money laundering and cross-border cybercrime.

So far this year, the numbers show that the problem is only getting worse. 

According to cybersecurity firm Certik, over $2.1 billion has been lost to hacks and scams in 2025 alone.  In May, there were 20 major hacks, which resulted in a combined $244.1 million in stolen assets.  Although this was a drop from April, the damage is still a real and massive one.

Additional data from Hacken’s April report shows $96 million lost to phishing scams and over $300 million to rug pulls in Q1 of this year. And it’s not just anonymous hackers behind these schemes. Increasingly, scams are being planned and executed by individuals or teams with visible public profiles.

Everyone including influencers, YouTubers, and even developers with past ties to legitimate projects are becoming bolder, and the scams will only get worse until reforms are introduced.