Recently, the Hong Kong Securities and Futures Commission (HKSFC) issued a caution to the public regarding a fraudulent cryptocurrency exchange platform known as Quantum AI. This platform was found to be using artificial intelligence-generated videos featuring Elon Musk, the SpaceX founder, to promote its crypto trading services.

The HKSFC raised concerns on May 8, emphasizing that Quantum AI, based in Hong Kong, falsely claimed direct links to Elon Musk. The exchange went as far as promoting Musk as the main developer of their product, utilizing deepfake videos and images of the entrepreneur across their online platforms and social media accounts.

Moreover, the misleading platform was accused of circulating inaccurate details about itself through a news outlet to build credibility among potential users. The HKSFC disclosed that the platform advertised unrealistically high returns on cryptocurrency investments, misleading the public into believing its claims.

Local sources have reported that the Hong Kong police have been assigned to take action against Quantum AI. This includes the removal of all associated websites and social media pages under the platform.

In recent times, scammers have used AI-generated videos as a powerful tool to engage in cryptocurrency-related fraud. Elon Musk has been a common target for such unlawful activities due to his vocal support of digital currencies, particularly Dogecoin. Numerous instances have occurred where scammers have exploited Musk's identity to promote fraudulent schemes across various social media platforms.

The issue extends beyond Elon Musk, as fraudsters have also impersonated other prominent figures in the crypto community to deceive users. Hong Kong is notably moving towards implementing a licensing system to regulate cryptocurrency service providers. As of now, the HKSFC has received applications from 23 exchanges and has instructed all other crypto businesses to halt operations in the region by May 2024.

For more details on similar crackdowns, you can read about India's Enforcement Directorate taking action against cryptocurrency fraud involving nearly 300 entities.