BingChatGPT ‘Pump And Dump’ Tokens Emerging By The Dozen

Key Points:

• PeckShield, a blockchain security company, has issued a warning after discovering many tokens that claim to be associated with ChatGPT, an AI-powered chatbot.
• According to PeckShield, “Deployer 0xb583” is at least one of the criminals behind the tokens and is in charge of producing “dozens of tokens with a pump & dump strategy.”
• 1.1 million tokens were released last year, but only 40,521 of those had a “effect on the crypto ecosystem,” as measured by at least ten swaps during four straight trading days in the week after their launch, according to the Blockchain analytics company.

PeckShield, a blockchain security company, has issued a warning after discovering many tokens that claim to be associated with ChatGPT, an AI-powered chatbot.

A smart contract that deceives a user into giving Ether, which the attacker subsequently captures and collects, is used in at least three “BingChatGPT” tokens, according to a post from the company on February 20.

In what is frequently known to as a “pump and dump” scam or “rug pull,” PeckShield claims that at least two of the tokens identified have already lost almost 100% of their value, while a third is at a 65% loss.

In a classic pump-and-dump scheme, the perpetrators orchestrate a campaign of false advertising and hype to get investors to buy tokens, then covertly sell their investment in the scheme when prices rise.

According to PeckShield, “Deployer 0xb583” is at least one of the criminals behind the tokens and is in charge of producing “dozens of tokens with a pump & dump strategy.”

While PeckShield did not explain why the bad actors are using the moniker BingChatGPT for their tokens, the scammers could be trying to take advantage of the Feb. 7 announcement that OpenAI’s ChatGPT platform is being integrated into Bing and Microsoft’s Edge web browser.

The name of the token may be an effort to deceive victims into believing they are somehow associated with Microsoft and capitalize on the buzz around AI chatbots.

In a report published on February 16 by the blockchain analytics company Chainalysis, it was revealed that almost 10,000 new tokens expected to be introduced in 2022 met all the criteria for pump-and-dump schemes.

1.1 million tokens were released last year, but only 40,521 of those had a “effect on the crypto ecosystem,” as measured by at least ten swaps during four straight trading days in the week after their launch, according to the Blockchain analytics company.

“Of the 40,521 tokens launched in 2022 that gained sufficient traction to be worth analyzing, 9,902, or 24%, saw a price decline in the first week indicative of possible pump and dump activity,” the firm said.

Even though a price decline by itself does not necessarily mean that the people who created the token did something wrong, the company looked at 25 in particular and discovered that “they were almost certainly designed for a pump and dump,” complete with malicious honeypot code that prevents new buyers from selling the token.

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