Crypto Scams: The Growing Threat of Artificial Intelligence-Powered Fraud

Introduction

Crypto scams have been a persistent threat in the digital landscape, and according to recent reports, 2025 may be the biggest year yet for these fraudulent activities. The proliferation of artificial intelligence (AI) and professional scamming support services has made it easier for scammers to operate, resulting in a significant increase in the number and sophistication of scams.

Scams on the Rise

According to a report by Chainalysis, the total revenue generated by crypto scams reached around $9.9 billion in 2024, with a predicted increase to over $12 billion in 2025. The firm attributes this growth to the use of generative AI, which is making scams more scalable and affordable for fraudsters.

How AI is Amplifying Scams

Elad Fouks, Chainalysis’ head of fraud products, notes that generative AI is “amplifying scams, the leading threat to financial institutions, by enabling high-fidelity, low-cost, and highly scalable fraud that exploits human vulnerabilities.” This technology allows fraudsters to create synthetic and fake identities, which they use to impersonate real users and bypass identity verification controls.

The Rise of Professional Scamming Support Services

The report highlights the emergence of professional scamming support services, such as Huione Guarantee, a peer-to-peer (P2P) marketplace that offers legitimate services but also facilitates illicit activities. According to Chainalysis, these services have seen an exponential growth in revenue, with AI service vendors’ revenue increasing by 1,900% between 2021 and 2024.

Deepfake Banking Fraud on the Rise

The US Federal Bureau of Investigation has sounded the alarm over the use of generative AI to target cryptocurrency investments. Deloitte’s Center for Financial Services estimates that generative AI and deepfakes will cost the US economy $40 billion by 2027.

Chainalysis’ Findings

Chainalysis’ report reveals that:

* 85% of scams involve fully verified accounts that bypass traditional identity-based solutions.
* AI-enabled scams are more convincing and harder to detect, as they use realistic fake content, including websites and listings.
* The use of AI is making scams more scalable and affordable for fraudsters.

Conclusion

The rise of AI-powered scams is a serious concern for the financial industry, and it is essential for financial institutions to stay ahead of the game. By understanding the tactics used by scammers, financial institutions can develop more effective strategies to prevent fraud and protect their customers.

FAQs

Q: What is the total revenue generated by crypto scams in 2024?
A: According to Chainalysis, the total revenue generated by crypto scams in 2024 was around $9.9 billion.

Q: What is the predicted growth in crypto scam revenue in 2025?
A: Chainalysis predicts that crypto scam revenue will increase to over $12 billion in 2025.

Q: How is AI being used in crypto scams?
A: AI is being used to create synthetic and fake identities, allowing fraudsters to impersonate real users and bypass identity verification controls.

Q: What is the estimated cost of deepfake banking fraud on the US economy?
A: Deloitte estimates that generative AI and deepfakes will cost the US economy $40 billion by 2027.

Q: What is the percentage of scams that involve fully verified accounts?
A: Chainalysis reports that 85% of scams involve fully verified accounts that bypass traditional identity-based solutions.