A new report from Elliptic reveals that artificial intelligence (AI) is increasingly being used to commit crimes within the crypto asset ecosystem.

**AI-Crypto Crimes**

The report highlights that criminals are using generative AI to create deepfakes and other deceptive materials to facilitate crypto scams. For instance, doctored videos of notable figures like Elon Musk and former Singaporean Prime Minister Lee Hsien Loong are being used to promote fraudulent investment schemes on platforms like YouTube, TikTok, and X. These deepfakes often trick individuals into investing in scam projects, leading to fund theft.

Additionally, there has been a significant rise in AI-related scam tokens, investment platforms, Ponzi schemes, and fake trading bots. Scammers leverage trendy technology and buzzwords to create fraudulent tokens or investment schemes that eventually turn into exit scams. They also use AI to generate hype around fraudulent investment platforms, especially by promoting AI-enhanced trading or arbitrage capabilities.

One notable scam involved a fake AI trading bot called iEarn in 2023, resulting in approximately $6 million in losses. This rise in AI trading bot scams led the Commodity Futures Trading Commission (CFTC) to issue a warning in January.

Elliptic's report also points out that criminals are using large language model (LLM) AI programs to find vulnerabilities in project codes, a finding supported by a recent Microsoft and OpenAI report indicating the growing use of LLMs by cybercriminals.

Moreover, AI is being used to facilitate large-scale crypto scams and disinformation campaigns by auto-generating social media posts and coding the necessary infrastructure for effective distribution.

Despite these threats, Elliptic believes that AI technology is still in its early stages and offers numerous benefits. To mitigate these risks, collaborative efforts are needed from all stakeholders, including law enforcement agencies, crypto compliance professionals, and AI users.