Blockchain security firm PeckShield has issued a warning that dozens of tokens claiming to be related to artificial intelligence (AI) powered chatbot ChatGPT have been identified as pump-and-dump schemes.
According to PeckShield, at least three “BingChatGPT” tokens appear to be part of honeypot schemes, in which users are tricked into sending Ether, which the attacker then retains.
At least two of the tokens have already lost nearly 100% of their value, while a third is at a 65% loss. Such pump-and-dump schemes typically involve the creators manipulating markets through a campaign of misleading statements and hype to persuade investors to purchase tokens, before secretly selling their stake in the scheme when prices rise.
While PeckShield did not clarify why the bad actors are using the name BingChatGPT for their tokens, it is suggested that the scammers may be taking advantage of the integration of OpenAI’s ChatGPT into Bing and Microsoft’s Edge web browser.
Blockchain analytics firm Chainalysis recently reported that nearly 10,000 new tokens launched in 2022 had all the characteristics of pump-and-dump schemes, highlighting a broader issue in the industry.
The proliferation of these pump-and-dump schemes highlights a major challenge for the cryptocurrency industry, which is still largely unregulated. While the technology underlying cryptocurrencies has made transactions more secure, it has also made it easier for scammers to defraud investors. As a result, it is becoming increasingly important for investors to exercise caution and conduct thorough research before investing in any cryptocurrency.
Investors should be wary of any investment that promises quick and significant returns. If an investment seems too good to be true, it probably is. Before investing in a cryptocurrency, research both the technology and people behind it
Despite the risks, the cryptocurrency industry continues to attract new investors. Many see the technology as a way to democratize finance and create new economic opportunities for people who may have been excluded from traditional financial systems. However, as the industry continues to evolve, it is important that investors remain vigilant and take steps to protect themselves from fraud.