Elliptica Warns AI-Driven Crypto Crimes Are Just Getting Started: Report

A recent report by blockchain intelligence firm Elliptic titled “AI-Enabled Crime in the Crypto Asset Ecosystem” has shed light on the emerging threats posed by artificial intelligence (AI) in crime cryptocurrency

The report, supported by case studies, identifies five emerging types of AI-enabled crime ranging from fake scams to state-sponsored cyberattacks, highlighting that these threats are still his childhood

AI Deepfake scams

AI, while it has the potential to significantly transform the global economy, also comes with risks. According to Elliptic, threat actors are already exploiting AI for illicit activities within the cryptoasset ecosystem.

One of the findings of the report is the use of AI to create deepfakes. Fraudsters use these highly realistic videos and images to impersonate high-profile individuals such as celebrities, politicians and industry leaders to legitimize fake projects.

“Crypto giveaways and duplication scams are increasingly using deepfake videos of crypto CEOs and celebrities to encourage victims to send funds to scammed crypto addresses.”

Specific cases mentioned in the report include deepfakes targeting Ripple (XRP) and its CEO Brad Garlinghouse, especially after the company’s legal victory against the US SEC in July 2023.

Other people who have been targeted by fake scams include Elon Musk, former Singapore Prime Minister Lee Hsien Loong, and Taiwan’s seventh and eighth presidents Tsai Ing-wen and Lai Ching-te.

Anne Neuberger, the US deputy national security adviser for cyber and emerging technologies, also addressed growing concerns about the misuse of AI. He emphasized that AI is used not only for everyday scams, but also for more sophisticated criminal activities.

“Some state and criminal actors in North Korea and other nation-states have been observed attempting to use AI models to accelerate the creation of malware and identify vulnerable systems,” Neuberger said.

GPT Tokens and Dark Web Activities

The hype around AI has also led to the creation of GPT-themed tokens, which are often promoted with promises of high returns. Elliptica warns that while some of them may be legitimate, many are being promoted on amateur trading forums with false claims of official partnerships with AI companies like ChatGPT.

The report also reveals discussions on dark web forums about leveraging AI models to reverse engineer crypto wallet seed phrases and bypass authentication for various services.

“Across numerous cybercrime forums on the dark web, Elliptic has identified chatter exploring the use of LLM to reverse-engineer crypto-wallet seed phrases, bypassing authentication for services such as OnlyFans and providing alternatives to image manipulation services like DeepNude.”

Elliptic also states that most AI-related threats to the cryptocurrency sector are still in their early stages, highlighting the importance of being vigilant and taking proactive steps to address these developing forms of crypto-crime.

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