The promoter of cryptocurrencies dubbed TruthGPT Coin and Elon Musk AI Token is being issued cease-and-desist orders from several state regulators, including Texas, seeking to crack down on scams looking to capitalize on the growing discourse around artificial intelligence.
(Bloomberg) — The promoter of cryptocurrencies dubbed TruthGPT Coin and Elon Musk AI Token is being issued cease-and-desist orders from several state regulators, including Texas, seeking to crack down on scams looking to capitalize on the growing discourse around artificial intelligence.
The cryptocurrencies are “part of a fraudulent securities scheme” allegedly perpetrated by a resident of San Francisco, Horatiu Charlie Caragaceanu, and related companies including The Shark of Wall Street, Texas officials said in a filing Wednesday. The issuer allegedly claimed the tokens have an Elon Musk-developed artificial-intelligence and machine-learning predictor algorithm to uncover lucrative ways to investing. They also claimed to plan to take their companies public.
The tokens are the latest reiteration of wrongdoers trying to leverage popular buzzwords and personalities to make money from unsuspecting investors, Joe Rotunda, director of enforcement division at Texas State Securities Board, said in an interview.
“We’ve got Elon Musk, artificial intelligence — it checks all the boxes,” Rotunda said. “This is an attempt to leverage that popularity to sell products that are fraudulent.”
Caragaceanu and his companies allegedly promoted investments into nonfungible tokens and coins like The Shark of WallStreet token through websites and social media. All of the tokens are now worthless, according to the Texas filing. The order accuses the defendants of currently promoting several new coins, such as Elon Musk AI token.
“Respondents are telling prospective investors that TruthGPT Coin is powered by an artificial intelligence platform developed by Elon Musk,” the Texas filing said. “They are referring to this artificial intelligence platform as Elon Musk AI.” The AI system supposedly provides used with ides for investments, and helps detect scams.
Rotunda said he’s sent a message to Twitter to reach Musk, but hasn’t hear back yet.
The website for the TruthGPT coin also contained imagery of the likes of Ethereum Co-founder Vitalik Buterin and Changpeng “CZ” Zhao, chief executive officer of Binance, implying they are involved, the filing said. Montana, Alabama, Kentucky and New Jersey are also filing orders against the defendants, Rotunda said.
“We haven’t received any complaints, we acted proactively,” Rotunda said. “The goal was to stop before anybody got into this, to keep it from getting bigger.”
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