Deepfake scams are on the rise in the cryptocurrency sector and could cause losses exceeding $25 billion by the end of 2024, a new report from Bitget Research claims.
According to the report, the first quarter of 2024 alone saw $6.3 billion in cryptocurrency losses due to deepfakes, coinciding with a 217% growth in the crypto sector compared to Q1 2023. China, Germany, Ukraine, the United States, Vietnam, and the United Kingdom reported the highest number of deepfake cases during this period.
In a recent interview, Ryan Lee, chief analyst at Bitget Research, pointed out criminals’ evolving tactics, including the use of AI-powered voice impersonation to trick victims into sending money to supposed relatives. He also noted the alarming trend of deep fakes being used to bypass Know Your Customer (KYC) security protocols.
Michael Saylor, executive chairman of MicroStrategy, has been a prime target for such scams. In January, he reported that his team removes over 80 AI-generated spoof videos of him daily, most promoting Bitcoin-related scams.
According to the report, these AI-powered schemes have resulted in $79.1 billion in losses since 2022.
Bitget CEO Gracy Chen highlighted how these scams often impersonate influential figures to create an illusion of credibility and substantial project capitalization. She also emphasized the urgent need for education and awareness, stating,
“Deepfakes are moving into the crypto sector in force, and there is little we can do to stop them without proper education and awareness.”
Meanwhile, Lee noted that Biget warns users when they register about these processes, and it has also implemented advanced AI solutions to help identify and prevent deep fake usage.
Bitget recently partnered with Sumsub to enhance its AI-powered Know Your Customer (KYC) verification tools and improve its ability to accurately identify and prevent deep fake scams by over 99%. Sumsub will provide Bitget with comprehensive verification tools, including Identity Verification, Liveness checks (with facial biometrics), Non-Document Verification, and Database Validation.
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