The Hong Kong Securities and Futures Commission (HKSFC) is warning the public about a fraudulent cryptocurrency exchange platform using AI-generated videos of Elon Musk to promote its trading services.
Tl;dr
- The HKSFC warns of a scam involving a Hong Kong-based company called Quantum AI.
- Quantum AI allegedly used Elon Musk and deepfakes to promote their product.
- The Hong Kong police are expected to intervene to stop this illegal practice.
- Hong Kong is seeking to regulate cryptocurrency service providers.
A Warning from HKSFC
The Hong Kong Securities and Futures Commission (HKSFC) issued a serious warning on May 8th. It flagged the company Quantum AI, based in Hong Kong, accusing it of disseminating misleading information to gain the public’s trust.
Elon Musk and Deepfakes
According to HKSFC, Quantum AI used the image of Elon Musk, the CEO of SpaceX, to promote its products. Besides claiming to have a direct link with Musk, the company used deepfake images and videos of him on their websites and social media. Such practices are not uncommon in cryptocurrency-related scams.
Police Intervention
Local reports suggest that the Hong Kong police have been ordered to take action against this platform. Quantum AI’s website and all its social media profiles are to be dismantled. This example highlights the need to regulate this still-emerging sector.
Towards Cryptocurrency Regulation
This case comes at a time when Hong Kong is working to establish a licensing regime to regulate cryptocurrency service providers. The HKSFC has received applications from 23 exchange platforms and demanded the cessation of activities from all other companies by the end of May 2024. Scams are not new in the cryptocurrency world, but they underscore the need for regulatory intervention.