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The Collision of AI and Crypto Attracts Scammers – What’s Going On?

Kathleen Breitman, co-founder of the Tezos blockchain, has raised a warning about a new wave of scams that combines the hype of artificial intelligence (AI) with the cryptocurrency industry. In a commentary piece for Fortune, Breitman highlighted the emerging trend where opportunistic individuals are seeking to exploit unsuspecting investors by blending these seemingly unrelated fields. As the crypto industry continues to evolve, Breitman emphasizes the importance of investor awareness and diligence to avoid falling victim to such scams.

Three types of AI-related crypto scams

Kathleen Breitman outlines three distinct flavors to the emerging trend of blending AI with cryptocurrency:

Using Crypto Tokens for Accessing AI Models or Services: In this flavor, scammers exploit the overlap in the usage of the term “tokens” in both AI and crypto contexts. While some AI services accept cryptocurrencies for payments, the linkage is often superficial. Entrepreneurs may attempt to convince investors otherwise.

“Data is the New Oil”: This flavor revisits the notion that “data is the new oil,” a phrase from the 2017 boom in initial coin offerings (ICOs) that has since become an internet meme.

Breitman’s warning highlights the need for investors to critically assess the legitimacy of projects merging AI and cryptocurrency, emphasizing the potential for misinformation and exploitation in this evolving landscape.

As per the Tezos co-founder, there’s a concern about scammers promoting tokens that purportedly offer rewards for individuals contributing personal data to AI training models under the guise of “data marketplaces.”

In her article, Breitman rejected this idea, asserting that personal data is not a sensibly monetizable asset.

Furthermore, Breitman anticipated the rise of tokens distinctly labeled with terms like “AI” or “GPT” (inspired by the widely known chat bot ChatGPT), leveraging the buzz surrounding these technologies.

Crypto and AI merger make little sense

To conclude, Breitman emphasized that the current endeavors to amalgamate AI and crypto lack coherence in the perspective of authentic AI developers.

She warned against succumbing to these “shoehorned” tokens, highlighting the crypto industry’s unfortunate tendency to devise dubious business models aimed at enticing unwitting investors.

“This involves rebranding existing crypto enterprises with the aim of offloading tokens onto retail investors,” she remarked, underscoring that the primary value of crypto lies in offering “a censorship-resistant store of value that unites people across borders.”

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I want to save money. Will cryptocurrency work?

Cryptocurrency is essentially virtual money that operates in a decentralized manner, not through a bank but directly on multiple independent computers.

Every cryptocurrency has two main components: the units of digital exchange called “coins” and the network within which the exchange takes place. These units can be transferred between wallets and exchanged on exchanges. The networks in which these coins exist are called blockchains, which translates to “chains of blocks.”

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