AI Crypto Crime is Only Just Beginning

AI crypto crime is just beginning as AI is used for sophisticated crypto crimes, from deepfake scams to state-sponsored cyberattacks.

AI-driven crypto crimes have ushered in a new era of cyber threats. An Elliptic report has revealed the exploitation of advanced technologies for deepfake schemes, state-sponsored attacks, and other sophisticated illicit activities.

A disturbing advertisement for an “unethical” GPT on the dark web, which asserts that “AI has two faces, just like humans,” is cited in the report.

This duality is further illustrated in the WormGPT advertisement that is emphasized in the report:

“Embrace the dark symphony of code, where rules cease to exist, and the only limit is your imagination. Together, we navigate the shadows of cyberspace, ready to conquer new frontiers. What’s your next move?”

Deepfake deep-dive

Elliptic disclosed that fraudulent investment schemes are being promoted through deepfake videos depicting Elon Musk and former Singaporean Prime Minister Lee Hsien Loong.

“Doctored videos – or ‘deepfakes’ – of notable individuals promoting investment scams have targeted the likenesses of Elon Musk, former Singaporean Prime Minister Lee Hsien Loong and both the 7th and 8th Presidents of Taiwan Tsai Ing-wen and Lai Ching-te.”

The report also emphasized the growing prevalence of deepfake deceptive tactics fraudsters use on social media communities to deceive unsuspecting victims into transferring their funds.

“Crypto giveaway and doubling scams are increasingly using deepfake videos of crypto CEOs and celebrities to encourage victims to send funds to scam crypto addresses.”

The United States foresees Korean criminality

Per the report, Anne Neuberger, the U.S. Deputy National Security Advisor for Cyber and Emerging Technologies, also addressed the escalating concerns regarding AI criminality.

Neuberger cautioned that AI is being exploited for objectives beyond the typical scams:

“Some North Korean and other nation-state and criminal actors have been observed trying to use AI models to accelerate the creation of malicious software and identifying vulnerable systems.”

AI crypto crime could be more financially rewarding

The report explains how AI is being misused, as evidenced by dark web forums.

“Throughout numerous dark web cybercrime forums, Elliptic has identified chatter that explores the use of LLMs to reverse-engineer crypto wallet seed phrases, bypassing authentication for services such as OnlyFans, and providing alternatives to image ‘undressing’ manipulation services such as DeepNude.”

The recent apprehension of a dark web market owner in New York on May 18 indicates that the potential for downfall increases as activity on the dark web increases.

The FBI tracked the 23-year-old man’s crypto transfers, which led to charges of owning, operating, and profiteering from a $100 million dark web narcotics marketplace.