AI-Powered Crypto Scams: A New Frontier of Fraud

In a cautionary piece, Kathleen Breitman, co-founder of the Tezos blockchain, warns of a burgeoning trend of AI-infused crypto scams exploiting the hype surrounding both technologies. She identifies three distinct types of these emerging scams:

• AI Tokenization: Scammers are leveraging the term "token" to imply that crypto tokens can be used to access AI models or services. While some AI services accept crypto payments, the connection is often superficial, and scammers exploit this overlap to mislead investors.
• Data Monetization Mirage: Rehashing the outdated notion of "data as the new oil," scammers are peddling tokens that supposedly reward individuals for contributing personal data to AI training models through "data marketplaces." Breitman categorically dismisses this concept, asserting that personal data is not a monetizable asset.
• AI-Branded Tokens: Capitalizing on the excitement surrounding AI technologies, scammers are creating tokens with "AI" or "GPT" (referencing the popular chat bot ChatGPT) in their names to lure unsuspecting investors.
  Breitman emphasizes that genuine AI developers view the attempts to merge AI and crypto as nonsensical. She urges investors to exercise caution against these "shoehorned" tokens, highlighting the crypto industry's unfortunate tendency to generate questionable business models targeting unsuspecting investors.

"This includes rebranding existing crypto businesses in hopes of dumping tokens on retail suckers," she remarked, reminding readers that crypto's primary value lies in providing "a censorship-resistant store of value that unites people across borders."

As AI and crypto continue to evolve, it's crucial for investors to remain vigilant and discerning, avoiding the allure of AI-infused crypto scams that offer unrealistic promises and lack genuine substance.