A pump and dump, where the bot promotes a little known cryptocurrency to artificially pump up its value until the bot sells its own holding, crashing the price. Others may trick the target into granting access to their digital wallet and then draining the account. Other schemes involve promoting risky or fraudulent crypto investments or penny stock offerings. Fraudsters pose as law enforcement agencies, law firms or crypto recovery specialists offering to assist in reclaiming cryptocurrency lost in a previous scam, hence the term “recovery room.”
These chisellers often create flashy websites including AI-manufactured testimonials from nonexistent clients and charge a hefty upfront fee, typically payable in cryptocurrency as well. AI-powered scammers are leveraging machine learning to magnify fraudulent activity in crypto markets. Pump-and-dump bots push obscure coins to inflate prices, while attackers trick victims into granting wallet access, allowing unauthorized draining of funds. Other schemes include promoting risky or fraudulent crypto investments or penny stock offerings.
Fraudsters impersonate law enforcement, law firms, or crypto recovery specialists promising to help reclaim lost funds, a tactic known as the recovery room. They often create flashy websites with AI-generated testimonials from nonexistent clients and charge large upfront fees payable in cryptocurrency. To protect yourself, verify sources, enable wallet security, and never share private keys or grant remote access. Stick to reputable exchanges, research before investing, and report suspicious activity to appropriate authorities.
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