"DeepSeek Scam Surge: 75 Fake Tokens Emerge, Crypto Market Plunges 5.5%"

The crypto market is grappling with a surge in fraudulent tokens, capitalizing on the viral success of Chinese AI firm DeepSeek. According to cybersecurity firm BlockAid, at least 75 scam tokens associated with the company were created by January 27, marking a threefold increase from the previous day. This trend mirrors previous incidents, such as the spike in fake tokens following the launch of Donald Trump’s memecoin earlier this month.

Scammers have set up decentralized applications (DApps) mimicking DeepSeek’s official website, complete with a deceptive “Connect Wallet” button that could potentially drain users’ cryptocurrency holdings upon interaction. BlockAid research analyst Oz Tamir highlighted the increasing sophistication of scammers exploiting popular trends and emphasized the need for heightened vigilance among crypto investors.

DeepSeek has issued a public warning via its social media accounts, clarifying that it has not released any cryptocurrency and cautioning users to avoid interacting with unauthorized accounts. Despite this advisory, some fraudulent tokens have already gained significant traction. One fake DeepSeek token reportedly reached a market capitalization of $48 million before its rapid decline, while another peaked at $13 million.

Similar trends were observed following the debut of Trump-branded tokens earlier in January. Copycat token launches surged from 3,300 per day to 6,800 during the memecoin’s rollout, illustrating how opportunistic scammers capitalize on major events.

DeepSeek’s rise has sparked widespread conversation, with many viewing its AI advancements as a potential rival to OpenAI’s ChatGPT. Remarkably, the company claims its AI model was developed for less than $6 million, a fraction of what American firms are reportedly spending on similar technologies.

However, viral success has not come without consequences. Investor concerns surrounding scams and frauds have led to a 5.5% drop in the overall cryptocurrency market over the past 24 hours.