Hong Kong authorities expose crypto scam featuring deepfake Elon Musk

The Hong Kong Securities and Futures Commission (HKSFC) has warned the public about a fraudulent crypto exchange platform that uses AI-generated videos of Elon Musk to promote crypto trading services.

On May 8, the HKSFC issued a warning claiming that the Hong Kong-based Quantum AI claimed to be in direct connection with the SpaceX founder. 

The exchange advertised Musk as the lead developer behind their product and used deepfake videos and images of him on their websites and social handles.

Further, the bogus platform was also accused of spreading “false and misleading information about itself” via a news outlet to gain trust among the general populace.

“It claims on the “news” website that the Hong Kong public has been using its technology to trade in cryptocurrencies and is able to earn “too-good-to-be-true” returns.” the HKSFC wrote.

Local reports suggest that the Hong Kong police have been directed to crack down on the platform. All of Quantum AI’s website and related social media pages will be taken down as a part of the move.

Over the past year, AI-generated videos have become a powerful weapon in the crypto scammer’s arsenal. 

Musk has always been a favorite among these bad actors due to his past advocacy for cryptocurrencies, especially Dogecoin. There have been multiple incidents where the Tesla CEO’s identity has been used to promote crypto scams across multiple social platforms. 

Most recently, during the solar eclipse event on April 8, YouTube was flooded with live streams using old videos of SpaceX and deepfakes of Elon Musk to lure users into sending crypto to scammers in the hopes of doubling it. 

These deceptive tactics are not limited to just Musk, as these fraudsters have used the identity of several popular names both within and beyond the crypto sector to dupe crypto users. Ethereum co-founder Vitalik Buterin was one such victim earlier this year.

In the backdrop of the commission’s warning, Hong Kong has also been pushing for a licensing regime to regulate cryptocurrency service providers. The HKSFC has received applications from 23 exchanges and has mandated all other businesses to cease operations in the area by the end of May 2024.