Coordination and Operational Recovery in Digital Asset Enforcement

Context

A London-based hedge fund identified a material discrepancy in its digital asset treasury where a significant quantity of stablecoins had been transferred from its cold wallet infrastructure without authorisation. The incident indicated either a sophisticated external compromise or a breakdown in internal access controls. The firm faced immediate financial exposure and possible regulatory risk. Rapid containment, forensic clarity, and defensible evidence gathering were essential to prevent asset dissipation and preserve legal remedies.

Appold was introduced to the client by a law firm and engaged to provide operational and technical leadership throughout the investigation and recovery process. Acting as the non-legal central coordination layer, referred to internally as “Quarterbacking”, Appold consolidated inputs from multiple specialist providers and ensured that information was presented in a coherent, decision-ready format to management under acute time pressure.

Appold’s mandate focused on operational execution and structured coordination across parallel workstreams. This included:

• Advising senior management on immediate response strategy and recovery pathways;

• Acting as the central coordination layer between the client, blockchain forensic specialists, data imaging experts, and other technical resources;

• Designing a bespoke automated transaction monitoring systems to track stolen assets in real time;

• Conducting independent blockchain asset tracing to map post-event movements;

• Aligning on-chain intelligence and technical evidence with the legal strategy being pursued;

• Advising on sequencing of actions to maximise asset preservation and evidential value.

A central challenge in digital asset incidents is decision-making under severe time pressure. Delays materially increase the risk of laundering, dissipation, and evidential degradation. Appold provided real-time operational risk assessment, enabling the client to make informed decisions in parallel with legal advice. While the law firm led legal strategy and court applications, Appold ensured operational execution remained disciplined and synchronised with civil proceedings. Based on investigative findings, including identification of a specific individual and ongoing monitoring of asset movements, the client elected, following legal advice, to pursue urgent civil remedies rather than immediate criminal escalation.

These included:

• A proprietary injunction over the digital assets;

• A worldwide freezing order;

• A search and imaging order (Anton Piller order) to secure devices, accounts, and relevant evidence.

The matter concluded with a negotiated settlement that recovered more than 80% of the misappropriated digital assets within 9 business days. The client achieved a high degree of certainty over both asset recovery and evidential position. Criminal processes are now following.

The hedge fund returned to normal operations within two weeks, having materially reduced regulatory and reputational exposure. Appold is now supporting enhancements to custody governance, access controls, and digital asset operational resilience.

Services

Project requirements:

• Strategic Advisory

• Digital Asset Tracing

• Research & Analysis