Crypto entrepreneurs cautioned about the emergence of manipulative deepfakes by Sandeep Nailwal
Deepfake scams are on the rise in the cryptocurrency world, exploiting advanced AI technology to impersonate trusted figures and manipulate victims into sending money, transferring crypto assets, or investing in fraudulent schemes. These scams create a false sense of trust and urgency, often demanding immediate transfers or promoting fake crypto investments and pump-and-dump schemes.
Deepfake Mechanisms
Scammers use several key mechanisms to execute their fraudulent activities. These include impersonation via deepfake video/audio calls, fake endorsements or promotional videos, phishing enhanced by AI, and pump-and-dump crypto schemes amplified by deepfakes.
In one instance, scammers might impersonate a CEO or CFO to approve urgent payments, or fabricate endorsements from famous people to legitimize fraudulent Initial Coin Offerings (ICOs), giveaways, or investment opportunities. Phishing attacks are also enhanced by AI, with highly targeted emails combined with deepfake voice phishing (vishing) that demand transfers or leak credential requests. Pump-and-dump schemes are amplified by deepfakes to hype tokens with fake hype and pressure tactics, leading victims to buy overpriced tokens before orchestrators dump their holdings.
Protecting Against Deepfake Scams
Given the rapid evolution and high impact of deepfake scams, it is crucial for both individuals and cryptocurrency organisations to adopt a continuous vigilance approach, layered security measures, and utilise emerging detection technologies.
Recommended security practices include carefully verifying video and voice sources, being sceptical of unsolicited investment advice or urgent requests, using multi-factor authentication, educating and training employees and individuals on recognising deepfake manipulation cues, implementing AI-driven deepfake detection tools, and implementing Zero Trust architecture.
Organisational safeguards such as AI-powered anomaly detection systems for unusual patterns in email, voice, or transaction behaviour are also essential. As deepfake scam losses are estimated to have exceeded $200 million in early 2025 alone, it is clear that these measures are necessary to protect digital assets and trust in communications within the crypto sector.
Recent Cases
A recent example of a deepfake scam occurred in the Polygon network, where scammers compromised the Telegram account of Shreyansh Singh, leader of Polygon Ventures. The scammers then contacted founders and teams of startups that Singh had previously interacted with, simulating interest in resuming investment conversations. Sandeep Nailwal, co-founder of Polygon, received a link to a supposed Zoom meeting with Nailwal himself through Telegram. However, Nailwal recognised the call as a deepfake due to the absence of audio and the fact that Nailwal doesn't typically join random Zoom meetings.
Nailwal urged the crypto community to avoid installing any software or script during unsolicited interactions to prevent the infiltration of malware. He also recommended separating wallet signing activities from daily device use, suggesting the use of a dedicated laptop for signing transactions and managing wallets. Nailwal expressed frustration with the lack of effective response from platforms like Telegram to these incidents and emphasised the need for closer collaboration between tech companies and users to strengthen security.
Conclusion
As deepfake scams continue to evolve and pose a significant threat to the cryptocurrency world, it is essential for individuals and organisations to remain vigilant, implement robust security measures, and stay informed about the latest detection technologies. By doing so, they can protect their digital assets and maintain trust in communications within the crypto sector.
- In the cryptocurrency world, deepfake technology is used by scammers to impersonate other trusted figures, such as CEOs or CFOs, for approving urgent payments or fabricating endorsements to legitimize fraudulent activities.
- To fight against these deepfake scams, it is advisable to adopt continuous vigilance, use layers of security, employ emerging detection technologies like AI-driven deepfake detection tools, and educate oneself and others on recognizing deepfake manipulation cues.
