In the first two installments of this series, I explained how BlockDivers became involved in the FX Winning matter and how what began as a forensic blockchain tracing assignment evolved into a much broader international investigation. As the case progressed, we followed the movement of funds across multiple jurisdictions, worked alongside attorneys and other professionals in several countries, and ultimately helped develop an international strategy designed to do something that is often far more difficult than tracing cryptocurrency: create a realistic pathway to recovery.
That distinction has been one of the most important lessons of the FX Winning investigation. In complex international fraud cases, obtaining a judgment is certainly an important legal victory, but it does not necessarily mean that victims are any closer to recovering their money. If a defendant has left the United States, moved assets overseas, or converted cryptocurrency into other forms of wealth, a judgment entered by a U.S. court may have limited practical value unless someone is prepared to determine how that judgment can actually be enforced where the defendant and assets are located.
In many ways, that is where the most important phase of our work in the FX Winning matter began.
Turning a U.S. Judgment Into International Leverage
After judgments exceeding $85 million were entered against David Merino and other defendants in the Southern District of Florida, we began working with counsel to determine how those judgments could be made meaningful outside the United States. Because Merino was believed to be in Dubai, the strategy eventually focused on establishing the legal foundation necessary to pursue enforcement in the United Arab Emirates.
That was neither a quick nor a simple process. U.S. judgments do not automatically become enforceable in another country, and a substantial amount of work was required in the United States and abroad before the judgments could be formally presented for recognition in Dubai. The process involved authentication, international legal procedures, local counsel, and ultimately proceedings before the appropriate courts in the UAE.
Once that process was completed and the judgments were recognized, however, the nature of the case changed considerably. We were no longer simply holding judgments issued thousands of miles away and hoping that Merino would someday return to a jurisdiction where they could be enforced. Working with separate local legal teams, civil and criminal proceedings were pursued under UAE law with the goal of creating meaningful legal pressure, preserving potential assets, restricting movement where legally available, and putting the plaintiffs in a position where the outstanding judgments could no longer simply be ignored.
This was an important strategic development because defendants in international fraud cases frequently rely upon geography as a form of protection. They may believe that leaving the country where the litigation occurred places enough distance between themselves and the judgment that enforcement becomes impractical. Cross-border enforcement is undeniably difficult, but when a judgment can be recognized in the jurisdiction where a defendant has chosen to live, that assumption can change very quickly.
When the Legal Pressure Became Real
Dubai presented an especially important opportunity because of the legal and regulatory environment in the UAE. Once the appropriate proceedings were underway, the strategy was no longer simply about knowing where Merino was located. It was about creating a lawful framework in which his ability to move freely, relocate again, or continue ignoring the outstanding judgments could potentially be restricted through the local legal system.
This is an important distinction because locating someone is not the same as creating leverage over them. An investigator may know exactly where a defendant lives, where he conducts business, and even where some of his assets are located, but that information alone does not produce a recovery. The intelligence has to be connected to a legal mechanism capable of producing action in that particular jurisdiction.
That is what we were attempting to accomplish in Dubai. Rather than waiting for Merino to return voluntarily to the United States, the strategy was to bring the enforcement effort to the jurisdiction where he was actually located and then use the remedies available under local law.
Merino’s arrest in early June fundamentally changed the posture of the matter. His detention was an important milestone, but it did not automatically recover money for the victims, nor did it eliminate the substantial legal work that remained. What it did accomplish was to bring years of litigation, investigation, and international enforcement efforts to a point where the outstanding legal issues could no longer be treated simply as problems existing somewhere else.
Since the arrest, legal representatives for the respective parties have remained in communication concerning the outstanding civil judgments and the possibility of resolving those obligations. Because those discussions are active and confidential, there are obvious limits to what we can appropriately disclose. It is fair to say, however, that the matter has now entered a very different phase from the one in which BlockDivers first became involved in December 2024.
The focus today is no longer simply on determining where the cryptocurrency went or where the defendant is located. The focus is on converting the legal and investigative work that has already been completed into an actual financial recovery for the victims.
An Arrest Is Not a Recovery
This brings us to what may be the most important point in this entire three-part series. An arrest creates headlines, and a large court judgment creates the appearance of victory, but neither necessarily returns a dollar to the people who lost their money.
Victims of financial fraud did not lose headlines; they lost money. For that reason, our objective was never simply to trace transactions, obtain a judgment, locate Merino, or contribute to the legal pressure that ultimately resulted in his detention. Each of those developments was important, but each represented another step toward the actual objective, which has always been recovery.
That is also why I believe the term “cryptocurrency recovery” is sometimes misunderstood. There is a tendency to think of recovery as a technical process in which investigators trace cryptocurrency through the blockchain until they identify the wallet or exchange where it ultimately landed. That work is essential, but identifying where an asset went does not mean that the asset can be seized, restrained, returned, or otherwise made available to satisfy a judgment.
The real recovery process begins when investigators and attorneys determine what can legally and practically be done with the intelligence that has been developed. Depending upon the case, that can involve courts, cryptocurrency exchanges, banks, regulators, law enforcement agencies, foreign counsel, asset freezes, judgment recognition proceedings, negotiations, and a host of other legal and investigative tools. In an international case, several of those efforts may need to occur simultaneously in different countries.
What BlockDivers Does Differently
The FX Winning investigation has become one of the clearest examples of what we believe separates BlockDivers from a traditional cryptocurrency forensic firm.
We use sophisticated blockchain forensic tools, and tracing digital assets remains an important part of our work. There are also many capable firms and talented forensic analysts who can trace transactions across blockchains, identify exchange exposure, and produce detailed reports explaining the movement of cryptocurrency.
Where our approach differs is in what happens after that report is completed.
We do not view a forensic report as the end product. We view it as intelligence that should help determine the next course of action. If the analysis identifies an exchange, we want to understand what legal opportunities may exist there. If it identifies a financial institution, we want to know what can be learned or lawfully pursued through that institution. If the defendant has moved overseas, we want to determine what remedies may exist in that country and whether a U.S. judgment can be transformed into something capable of producing meaningful consequences there.
This requires a very different set of capabilities than blockchain analysis alone. BlockDivers was built by professionals with backgrounds in U.S. government service, special operations, investigations, intelligence, and complex international environments. The value of those backgrounds is not simply found in the résumés of the people on our team. It is reflected in how we approach difficult international problems and how comfortable we are operating in environments that may be unfamiliar to traditional forensic firms.
Our team has spent years working internationally, building relationships and learning how to operate effectively in different parts of the world. Through that experience, we have developed relationships with attorneys, investigators, forensic specialists, former government officials, law enforcement professionals, and other trusted resources across numerous jurisdictions. Those relationships become especially important when a case moves beyond the United States and there is no simple procedural roadmap for what comes next.
From Blockchain Intelligence to Recovery Intelligence
When a defendant leaves the United States, we do not automatically assume that a U.S. judgment has become meaningless. Instead, we begin looking at the problem from the jurisdiction where the defendant or assets are actually located.
Can the judgment be recognized there? What remedies are available under local law? Are there assets that can potentially be restrained? Are there lawful mechanisms that can restrict movement? Which attorneys have the appropriate experience? Which authorities may have jurisdiction? Are there additional civil or criminal avenues that local counsel should evaluate? Most importantly, can all of these different pieces be brought together into a coordinated strategy that creates a realistic opportunity for recovery?
This is what we have come to describe as recovery intelligence.
Recovery intelligence goes beyond identifying transactions on a blockchain. It combines financial intelligence, legal strategy, international relationships, investigative experience, and local knowledge with the objective of converting information into action. In many cases, that means continuing to work long after the traditional forensic investigation would otherwise have ended.
The FX Winning matter illustrates that process particularly well. We began by tracing cryptocurrency. The investigation then expanded into international financial intelligence and on-the-ground investigative work, first in Panama and eventually in Dubai. U.S. judgments were obtained and subsequently taken through the process necessary to pursue recognition overseas. Local legal teams became involved, parallel proceedings were pursued, and an international enforcement strategy gradually developed around the intelligence we had gathered.
None of those individual steps, standing alone, constituted a recovery strategy. The strategy came from connecting them.
Going Beyond the Judgment
There is a phrase we have used repeatedly throughout this investigation: follow the money. It remains one of the fundamental principles of financial investigation, but the FX Winning case taught us that there is another question that is equally important.
What do you do once you find it?
Knowing that cryptocurrency passed through a particular wallet or exchange is valuable. Knowing that a defendant is living in another country is valuable. Obtaining a substantial judgment is obviously valuable. But ultimately, each of those things represents intelligence or legal authority that still has to be converted into something actionable.
That is why we do not think of BlockDivers as a repossession company, nor do we think of ourselves simply as a cryptocurrency tracing firm. Our work increasingly sits at the intersection of blockchain forensics, international financial intelligence, investigations, legal strategy, and asset recovery. Our role is to help connect those disciplines and continue pursuing a matter beyond the point where a conventional forensic engagement might otherwise end.
There will always be jurisdictions where enforcement is extraordinarily difficult, and there is never a guarantee that assets identified during an investigation can ultimately be recovered. International asset recovery is complicated precisely because laws, courts, financial systems, and enforcement mechanisms stop at national borders even though cryptocurrency does not.
The answer is not to pretend those borders do not exist. The answer is to understand them and determine whether there is a legitimate pathway through them.
The Final Objective
When BlockDivers was first retained in December 2024, our assignment in the FX Winning matter was relatively straightforward: trace cryptocurrency connected to investor funds.
No one knew at the time exactly where that assignment would lead. Over the following year and a half, the investigation moved from blockchain analysis to international financial intelligence, from Panama to Dubai, from U.S. litigation to foreign judgment recognition, and ultimately from tracing transactions to pursuing a defendant and seeking meaningful enforcement in another country.
Merino’s arrest in early June was an important milestone in that process, but it was never the final objective. The case remains active, communications between the respective legal teams continue, and there are aspects of the current proceedings that we cannot and will not discuss publicly while those matters remain unresolved.
What we can say is that the objective today is the same objective we had when this investigation began: to help the victims recover their money.
The FX Winning matter has reinforced our belief that international cryptocurrency recovery cannot be accomplished by technology alone. It requires technology, legal strategy, investigative experience, local knowledge, trusted relationships, and the willingness to continue working when the trail crosses borders and the easy options have disappeared.
The blockchain can tell us where the money went, and a court judgment can establish who is legally responsible for paying it. Neither one, by itself, completes the job.
The real work is figuring out how to get it back.