US, UK, and Canada Crypto Fraud Crackdown: What Operation Avalanche Shows

Canadian securities regulators, backed by the U.S. Secret Service, ran a two-day operation in March 2025 to warn nearly 90 victims of Ethereum approval-phishing scams, part of a widening multinational push by the US, UK, and Canada to disrupt crypto fraud before losses grow further.

The effort, dubbed Operation Avalanche, was led by the BC Securities Commission and ran on March 11-12, 2025. Authorities identified compromised Ethereum wallets, tracked down the owners, and contacted 89 victims by telephone or email to prevent additional funds from being drained.

The blockchain addresses flagged during the operation had already been drained of an estimated $4.3 million in crypto assets, the BCSC said in its announcement.

What Operation Avalanche Actually Confirmed

Operation Avalanche was a Canadian-led initiative, not a formal trilateral government launch. The confirmed participants included the BC Securities Commission, the Alberta Securities Commission, the Ontario Securities Commission, the Autorite des marches financiers, the Delta Police Department, the Vancouver Police Department, the RCMP, and the U.S. Secret Service.

The operation’s approach was prevention rather than prosecution. Instead of chasing scammers overseas, regulators used blockchain intelligence to find victims whose wallets had been compromised through approval phishing and warned them directly.

Lori Chambers of the BCSC explained the reasoning behind that shift:

“Our traditional method of investigating, prosecuting and sanctioning won’t work for these scammers, who are often organized crime groups operating in other countries, largely beyond our reach.”

The 89 victims contacted represent only one operation’s haul. The underlying scam technique, approval phishing on Ethereum, tricks users into signing token-approval transactions that give attackers permission to drain wallets at will.

How US, UK, and Canada Cooperation Fits Into a Broader Crackdown

The headline framing of a joint US-UK-Canada operation requires context. No official source confirms the UK participated in Operation Avalanche specifically. UK involvement appears under a separate but related umbrella: Operation Spincaster, coordinated by blockchain analytics firm Chainalysis.

Operation Spincaster spanned six countries, including the U.S., UK, Canada, Spain, the Netherlands, and Australia. That broader program generated more than 7,000 leads tied to roughly $162 million in scam-related losses.

Danny Leong, speaking about the cross-border dimension, noted:

“These types of scams are not unique to Canada, and by working with Chainalysis, we are part of a much larger, global effort to tackle this type of criminal activity.”

The distinction matters. Operation Avalanche was a specific Canadian enforcement action with confirmed U.S. Secret Service participation. Operation Spincaster is a wider multinational framework that includes the UK. Both target crypto fraud, but they are not the same initiative. Readers searching for a single trilateral government announcement will not find one, because the cooperation is structured across overlapping programs rather than a single joint launch.

Why Ethereum Approval Phishing Remains a High-Risk Tactic

Approval phishing exploits a core feature of Ethereum’s token standard. When users interact with decentralized applications, they often sign transactions granting smart contracts permission to move tokens on their behalf. Scammers trick victims into signing these approvals for malicious contracts, then drain funds at their convenience.

What made Operation Avalanche notable was the enforcement model: using on-chain wallet tracing to identify victims before they lost more money, rather than waiting for complaints. Authorities identified the compromised wallets, matched them to real people, and reached out directly.

That proactive approach reflects a broader shift in how regulators handle crypto fraud. Traditional enforcement struggles with overseas organized crime groups running these schemes. Wallet-level intervention, contacting victims and helping them revoke malicious approvals, offers a faster path to limiting damage.

For crypto users, the practical takeaway is straightforward: review and revoke token approvals regularly, especially for contracts you do not recognize. The $4.3 million drained from wallets identified in this single operation underscores how quickly approval phishing losses compound when victims are unaware their wallets have been compromised.

The broader multinational coordination through programs like Operation Spincaster, combined with targeted actions like Operation Avalanche, signals that regulators are building infrastructure for ongoing crypto fraud disruption rather than one-off enforcement sweeps. With prediction markets drawing regulatory scrutiny and institutional crypto flows continuing to grow, the enforcement landscape is expanding alongside the market itself.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.