The US regulator has issued a warning about rising fraud in the crypto industry fueled by AI, social media, and ATMs.
Regulator's Warning
Claire McHenry, deputy director of the Nebraska Department of Banking and Finance and president of the NASAA, highlighted the increase in cryptocurrency-related fraud. In her statement, she noted that there has been a significant rise in complaints, investigations, and enforcement actions involving digital assets.
Role of Crypto ATMs in Fraud
McHenry pointed out the role of crypto ATMs in fraudulent schemes. According to her, 98% of transactions processed by a single ATM operator in Nebraska were linked to scams. She also highlighted the vulnerability of older Americans who are often targeted through tech support and investment scams.
Growing Threat in the AI Era
According to McHenry, AI technology has dramatically enhanced the sophistication of scams. Fraudsters now create convincing phishing schemes, deepfake videos, and automated chatbots to deceive investors. She argued that traditional scam prevention strategies are no longer sufficient, calling for improved media literacy to recognize digital deception.
Fraud in the cryptocurrency world continues to evolve with technology. New strategies are required to protect investors.
