With institutional and retail buyers each turning their consideration to AI final month, AI-related crypto tokens akin to Fetch (FET), SingularityNET (AGIX), and Ocean Protocol (OCEAN) noticed important features all through January.
Nevertheless, concurrent to these features has been an uptick in scams, with @PeckShieldAlert saying this week the invention of a number of dozen rip-off tokens related to Bing’s integration of ChatGPT.
The usage of a honeypot rip-off is widespread in crypto. A honeypot rip-off includes a fraudulent supply to buyers that they may obtain additional funds after transferring an preliminary sum, however in actuality, they may by no means obtain their a reimbursement.
Immediately, with investor curiosity skyrocketing in AI within the wake of Microsoft’s eye-watering $10 billion funding into OpenAI’s ChatGPT, information of the language mannequin going viral has additionally been a breeding floor for brand spanking new types of fraudulent exercise.
Peck Defend’s evaluation discovered that at the least 20 tokens presently bear the title BingChatGPT in the marketplace. Of those, 12 are on Binance’s BNB Chain, six have been created on Ethereum, and two extra on Arbitrum.
In accordance with on-chain evaluation, a staggering 170 tokens are actually utilizing the ChatGPT title, with BNB the most typical protocol for his or her issuance.
Neither Microsoft nor OpenAI has introduced any official cryptocurrency tasks.
The marketplace for honeypots and different scams in crypto is, nonetheless, growing.
Final yr, crypto buyers misplaced practically $3.8 billion to hackers— up from $3.3 billion in 2021—in response to a Chainalysis report.
Honeypot scams growing
Between September 2020 and December 2022, it’s estimated by Solidus Labs that over 200,000 fraudulent tokens have been created, resulting in greater than 2 million buyers falling sufferer to rug pulls and exit scams involving them.
On April 19, 2022, PeckShield instructed that the XTZ token might be a honeypot rip-off, which brought on it to plummet by 99.97% inside 24 hours. Regardless of this warning, over 5,000 crypto buyers shilled into the token. Every week earlier, the token surged over 700% in an hour. The venture’s web site and social media accounts remained energetic even after the numerous drop, which means that even after a venture is found to be a honeypot rip-off, in some instances, investor curiosity will stay.
Within the previous yr, the web3 venture Squid Recreation (SQUID) was closely hyped because of the recognition of the Squid Recreation Netflix collection. The venture scammers took off with $5.7 million from funds by draining the liquidity pool, utilizing a web site with a number of grammatical errors and that includes an anti-dump mechanism.