"AI-Driven Crypto Scams to Surge in 2025: Chainalysis Warns"

Crypto scams are poised to reach unprecedented heights in 2025, driven by the rapid growth of artificial intelligence and the emergence of professional scamming support services. According to blockchain analytics firm Chainalysis, the fraud industry is becoming increasingly sophisticated, with generative AI playing a significant role in amplifying scams.

In its Feb. 13 Crypto Scam Revenue 2024 report, Chainalysis warned that generative AI is making scams more scalable and affordable for bad actors. Elad Fouks, Chainalysis’ head of fraud products, stated that AI is enabling high-fidelity, low-cost, and highly scalable fraud that exploits human vulnerabilities. It facilitates the creation of synthetic and fake identities, allowing fraudsters to impersonate real users and bypass identity verification controls.

Chainalysis found that crypto scam revenue reached around $9.9 billion in 2024, led by pig butchering scams. The firm expects the figure to likely increase to over $12 billion as it identifies more addresses associated with fraud and scams. Using its new fraud detector, acquired last month for a reported $150 million, Chainalysis discovered that 85% of scams involve fully verified accounts that bypass traditional identity-based solutions, a trend exacerbated by AI.

Fouks explained that generative AI enables the creation of realistic fake content, including websites and listings, to power investment scams, purchase scams, and more. This makes these attacks more convincing and harder to detect. Deloitte’s Center for Financial Services estimates that generative AI and deepfakes will cost the US economy $40 billion by 2027.

Crypto fraud and scams have continued to increase in sophistication, with operations like Huione Guarantee, a peer-to-peer (P2P) marketplace that offers legitimate services but also supports illicit services. Chainalysis noted that Huione scam infrastructure providers’ revenue has increased exponentially since 2021, with AI service vendors’ revenue growing by 1,900%.

The US Federal Bureau of Investigation sounded the alarm over scammers using generative AI to target cryptocurrency investments last December. Chainalysis expects the total losses from scams to be even higher after considering AI-powered scams, with its annual estimates of scam activity growing by an average of