Hundreds of Fake ChatGPT Tokens Lure Crypto Investors, Majority Issued on BNB Chain
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- Blockchain security firm PeckShield has discovered dozens of pump-and-dump tokens posing as artificial intelligence chatbot ChatGPT, with around 132 tokens issued on BNB Chain, 25 tokens on Ethereum, and 10 separate tokens on other blockchains.
- The fraudulent tokens were created by a developer under the pseudonym “Deployer 0xb583” who uses a pump-and-dump scheme to take investors’ money and disappear, according to PeckShield.
- More than 170 ChatGPT-branded tokens have been issued on decentralized exchanges such as Uniswap and PancakeSwap, with studies claiming that 97.7% of tokens launched on Uniswap are “rug pulls.”
In line with the growing popularity of artificial intelligence (AI) tokens, fraudsters also jumped into the craze and took advantage of the hype by issuing fake tokens.
Blockchain security firm PeckShield shared and alarmed the crypto community that it has found dozens of pump-and-dump tokens pretending to be related to artificial intelligence chatbot ChatGPT.
Accordingly, numerous tokens with no official association with the tool are noted to have been issued in the past few weeks; on BNB Chain about 132 different tokens have been issued, 25 tokens on Ethereum and 10 separate tokens on other blockchains like Solana, Arbitrum, OKChain and Cronos.
“PeckShield has detected dozens of newly created #BingChatGPT tokens, of which 3 appear to be #honeypots & 2 have high sell tax. 2 of them have already dropped over -99%,” PeckShield tweeted.
Basically, honeypots are smart contracts that purport to leak their funds to an arbitrary user, provided that the user sends additional funds to it.
“Deployer 0xb583 has already created dozens of tokens with a pump & dump scheme,” the firm added.
A pump-and-dump or a rugpull are schemes wherein a developer creates a project, promotes it to investors, and disappears with most (if not all) of its profit. (Read more: Are Project Owners and Influencers Responsible for an NFT Rug Pull?)
In addition, as per the data from DEXTools, around 170 ChatGPT-branded tokens were now issued on decentralized exchanges such as Uniswap and PancakeSwap. Recently, two studies claimed that 97.7% of the tokens launched on the decentralized cryptocurrency exchange Uniswap are “using locking contracts that tend to become a rug pull or a malicious token eventually.” (Read more: 97% of Uniswap Tokens Are ‘Rug Pulls’ –Report)
Further, according to the 2022 Rug Pull report, an analysis released by blockchain risk monitoring firm Solidus, revealed that more than 350 cryptocurrency tokens aimed at scamming investors were created per day from the start of 2022 to December 1. (Read more: From 83K to 120K: 350 ‘Scam Tokens’ Created Each Day in 2022, 40% Higher than 2021 — Report)
What are AI Tokens?
AI tokens are cryptocurrencies that utilize AI to improve various factors such as security, scalability, and user experience. These tokens power AI-related projects such as decentralized AI marketplaces, AI-powered portfolio management, and autonomous organizations. (Read more: AI Tokens Soar Above Bitcoin and Ethereum: What You Need to Know)
According to CryptoSlate, AI tokens are currently up by 1.86% for the last seven days with sector market capitalization totaling to $4.16 billion.
This article is published on BitPinas: Hundreds of Fake ChatGPT Tokens are Luring Crypto Punters, Majority Issued on BNB Chain
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