Artificial Intelligence - The Double-Edged Sword of Crypto

AI did not only push the industry forward but also moved it a few steps back.

Artificial Intelligence - The Double-Edged Sword of Crypto

Since the mainstream advent and accelerated growth of Artificial Intelligence (AI), this technology has had a significant impact on many modern industries. Companies like OpenAI have revolutionized the way we interact with personal assistants, writing, content creation, etc.

On the other hand, artificial intelligence has also played a big role in the world of IT and tech. This was also the case 10 years ago, but now the influence of AI is unmistakable. From AI-powered simulations to virtual environments to making strides in robot radiotherapy, AI has had a hand in it all.

It is, therefore, no surprise that AI infiltrated the world of cryptocurrencies as well. However, it did not only push the industry forward but also moved it a few steps back. Namely, it has amplified the scams and fraudulent activities often associated with crypto.

Interestingly, the AI technology is, in this case, not used to evolve previous scamming mechanisms, nor is it used to develop new and innovative techniques. It is instead only used to supercharge old, well-known tricks.

So, what do you need to look out for?

Elliptic researchers identify five main “typologies”, which use AI to strengthen their illicit efforts. These include misleading deepfakes, AI-scam tokens, using large language models to devise hacks, spreading of misinformation, and improved phishing websites/tactics to accelerate identity theft.

The reasons why these old and somewhat outdated tactics are still efficient today are manifold, as Pete Pachal, author of the Media CoPilot Substack, wrote in his article about deepfakes, AI, and crypto. He points out that deep fakes, such as Quantum AI’s fraudulent advertisement, are as successful as they are due to attracting people that are perhaps not steeped deep enough into the crypto culture.

Because the notion of crypto gains is so attractive to the uninitiated, many of these “newcomers” tend to overlook telltale signs of a crypto scam. In other words, the ‘fool me once’ principle does not work as intended if the subject has not yet been fooled.

That being said, a brief look into the matter and an educational video or two, should be sufficient enough to provide users with ways of detecting AI-generated scams when they come into contact with them. Take a look at this Robokiller article to get a brief overview of possible AI scams and how you can combat them by always staying aware.

Transparency and trust are not words we commonly associate with cryptocurrencies, but that does not need to be the case forever.

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