The rapid rise of generative artificial intelligence is providing new ground for cryptocurrency scammers to carry out their illicit activities, which remained at elevated levels in 2024.
Cryptocurrency scams generated at least $9.9 billion on-chain, meaning those that occur on the blockchain and have been reflected on the public ledger, figures released by Chainalysis on Thursday showed.
“Generative AI is amplifying scams, the leading threat to financial institutions, by enabling high-fidelity, low-cost and highly scalable fraud that exploit human vulnerabilities,” Elad Fouks, head of fraud products at Chainalysis, wrote in the report.
Those scams were led by one particular scheme that took advantage of the emotions of unsuspecting victims, know as pig-butchering.
Pig-butchering scams
Pig-butchering refers to scams where fraudsters earn their victims' trust, usually through a fictitious romantic relationship, before duping them into making investments in bogus cryptocurrency projects.
Revenue made by such scammers increased by almost 40 per cent annually last year to roughly $3.3 billion, Chainalysis data shows.
Perpetrators have also evolved to diversify the scam model, which initially focused on a long-term scheme. It took months or even years for a scammer to develop a relationship with their victims and make the latter agree to invest in fake projects.
Increasingly, con artists have developed methods with quicker turnarounds, such as employment or work-from-home scams, which typically yield smaller victim deposits yet add up to significant amounts.
The numbers reflect this shift: deposits to pig-butchering scams rose by nearly 210 per cent annually in 2024, possibly indicating an expansion of its victim pool, Chainalysis said. Meanwhile, the average deposit amount decreased 55 per cent year-on-year, and this combination of lower payment amounts and increased deposits could highlight a change in strategy, the company added.
"We can’t allow ourselves to be easy targets ... always remain sceptical of unsolicited messages or 'fabulous' investment opportunities: if it seems too good to be true, it most likely is," Ivan Milenkovic, a vice president at California-based IT security firm Qualys, told The National.
Pig-butchering has its roots in large-scale scam operations in South-East Asia, the Chainalysis study said. International Justice Mission, a global body that protects people in poverty from violence, began observing forced labour cases tied to these operations in 2021, and has since recorded immense growth of these crimes.
However, this type of scam has become more geographically dispersed, especially in the past two years. One example in December 2024 was the arrest of 48 Chinese and 40 Filipino nationals in Nigeria on charges of running a crypto scam operation that aimed at people mostly from Europe and the Americas.
Interpol last year also co-ordinated a global operation to stop such scams, including one in Namibia that forced 88 youths to participate as part of an international ring. Peruvian authorities also rescued 43 Malaysian citizens trafficked to Peru who were forced to work in a scam operation.
"If someone is offering you something too good to be true [it could be a] prelude to an attack," Morey Haber, chief security adviser of US cybersecurity company BeyondTrust, told The National.
The Chainalysis report also highlighted high-yield investment scams (HYIS), where fraudsters promise a high return for your money. HYIS accounted for more than 50 per cent of crypto among scam sub-classes, although inflows dropped by 36.6 per cent annually, the report said.
Crypto drainer scams, where assets are siphoned out of wallets, and rug pull scams, where scammers abruptly abandon projects and run away with amounts invested with them, were also on the rise last year.
Crypto ATMs, which have been around for more than a decade, have also become a weapon of choice for scammers: the Federal Bureau of Investigation has said that it has received thousands of reports about cyber criminals using crypto ATMs to receive payouts for scams, leading to a tenfold surge in funds lost in the US.
How is AI being used for fraud?
There are several AI-based techniques that fraudsters use, including language translation, where threat actors can send e-mails, text messages or voice mails, with flawless grammar in almost any language.
"This circumvents the best content filters, even if they are AI-driven, by eliminating detections based on poor grammar, spelling, or other questionable content," Mr Haber said.
Then there are deepfakes, most notably used in images and videos that mimic real-world personalities and situations, giving the impression that they are real.
These techniques are making it tougher for authorities to crack down on crypto scammers. This has led to heightened calls for more collaboration to combat illicit activity in the growing sector.
Generative AI's "realistic fake content, including websites and listings, to power investment scams, purchase scams and more, make attacks more convincing and harder to detect", Mr Fouks said.
Key products and UAE prices
iPhone XS
With a 5.8-inch screen, it will be an advance version of the iPhone X. It will be dual sim and comes with better battery life, a faster processor and better camera. A new gold colour will be available.
Price: Dh4,229
iPhone XS Max
It is expected to be a grander version of the iPhone X with a 6.5-inch screen; an inch bigger than the screen of the iPhone 8 Plus.
Price: Dh4,649
iPhone XR
A low-cost version of the iPhone X with a 6.1-inch screen, it is expected to attract mass attention. According to industry experts, it is likely to have aluminium edges instead of stainless steel.
Price: Dh3,179
Apple Watch Series 4
More comprehensive health device with edge-to-edge displays that are more than 30 per cent bigger than displays on current models.
What are the influencer academy modules?
- Mastery of audio-visual content creation.
- Cinematography, shots and movement.
- All aspects of post-production.
- Emerging technologies and VFX with AI and CGI.
- Understanding of marketing objectives and audience engagement.
- Tourism industry knowledge.
- Professional ethics.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
SPEC%20SHEET%3A%20APPLE%20M3%20MACBOOK%20AIR%20(13%22)
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Superliminal%20
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UAE SQUAD
Mohammed Naveed (captain), Rohan Mustafa, Ashfaq Ahmed, Rameez Shahzad, Shaiman Anwar, Mohammed Usman, Mohammed Boota, Zawar Farid, Ghulam Shabber, Ahmed Raza, Sultan Ahmed, Imran Haider, Qadeer Ahmed, Chirag Suri , Zahoor Khan
Killing of Qassem Suleimani
What is Bitcoin?
Bitcoin is the most popular virtual currency in the world. It was created in 2009 as a new way of paying for things that would not be subject to central banks that are capable of devaluing currency. A Bitcoin itself is essentially a line of computer code. It's signed digitally when it goes from one owner to another. There are sustainability concerns around the cryptocurrency, which stem from the process of "mining" that is central to its existence.
The "miners" use computers to make complex calculations that verify transactions in Bitcoin. This uses a tremendous amount of energy via computers and server farms all over the world, which has given rise to concerns about the amount of fossil fuel-dependent electricity used to power the computers.
MATCH INFO
Uefa Champions League semi-final, second leg
Real Madrid (2) v Bayern Munich (1)
Where: Santiago Bernabeu, Madrid
When: 10.45pm, Tuesday
Watch Live: beIN Sports HD
Desert Warrior
Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley
Director: Rupert Wyatt
Rating: 3/5
The five pillars of Islam
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
MATCH INFO
Syria v Australia
2018 World Cup qualifying: Asia fourth round play-off first leg
Venue: Hang Jebat Stadium (Malacca, Malayisa)
Kick-off: Thursday, 4.30pm (UAE)
Watch: beIN Sports HD
* Second leg in Australia scheduled for October 10
First Person
Richard Flanagan
Chatto & Windus
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
Pad Man
Dir: R Balki
Starring: Akshay Kumar, Sonam Kapoor, Radhika Apte
Three-and-a-half stars
GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
Fixtures (all times UAE)
Saturday
Brescia v Atalanta (6pm)
Genoa v Torino (9pm)
Fiorentina v Lecce (11.45pm)
Sunday
Juventus v Sassuolo (3.30pm)
Inter Milan v SPAL (6pm)
Lazio v Udinese (6pm)
Parma v AC Milan (6pm)
Napoli v Bologna (9pm)
Verona v AS Roma (11.45pm)
Monday
Cagliari v Sampdoria (11.45pm)
Company%20profile
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UAE squad v Australia
Rohan Mustafa (C), Ashfaq Ahmed, Chirag Suri, Rameez Shahzad, Fahad Nawaz, Amjed Gul, Shaiman Anwar, Ahmed Raza, Imran Haider, Muhammad Naveed, Amir Hayat, Ghulam Shabir (WK), Qadeer Ahmed, Tahir Latif, Zahoor Khan
Results
%3Cp%3E%0D%3Cstrong%3EElite%20men%3C%2Fstrong%3E%0D%3Cbr%3E1.%20Amare%20Hailemichael%20Samson%20(ERI)%202%3A07%3A10%0D%3Cbr%3E2.%20Leornard%20Barsoton%20(KEN)%202%3A09%3A37%0D%3Cbr%3E3.%20Ilham%20Ozbilan%20(TUR)%202%3A10%3A16%0D%3Cbr%3E4.%20Gideon%20Chepkonga%20(KEN)%202%3A11%3A17%0D%3Cbr%3E5.%20Isaac%20Timoi%20(KEN)%202%3A11%3A34%0D%3Cbr%3E%3Cstrong%3EElite%20women%3C%2Fstrong%3E%0D%3Cbr%3E1.%20Brigid%20Kosgei%20(KEN)%202%3A19%3A15%0D%3Cbr%3E2.%20Hawi%20Feysa%20Gejia%20(ETH)%202%3A24%3A03%0D%3Cbr%3E3.%20Sintayehu%20Dessi%20(ETH)%202%3A25%3A36%0D%3Cbr%3E4.%20Aurelia%20Kiptui%20(KEN)%202%3A28%3A59%0D%3Cbr%3E5.%20Emily%20Kipchumba%20(KEN)%202%3A29%3A52%3C%2Fp%3E%0A
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
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FIXTURES
All kick-off times UAE ( 4 GMT)
Friday
Sevilla v Levante (midnight)
Saturday
Athletic Bilbao v Real Sociedad (7.15pm)
Eibar v Valencia (9.30pm)
Atletico Madrid v Alaves (11.45pm)
Sunday
Girona v Getafe (3pm)
Celta Vigo v Villarreal (7.15pm)
Las Palmas v Espanyol (9.30pm)
Barcelona v Deportivo la Coruna (11.45pm)
Monday
Malaga v Real Betis (midnight)
The five pillars of Islam
