March 04, 2025
By Anjali Kochhar
Chinese authorities have issued warnings about scams misusing the DeepSeek name to deceive investors and businesses. Fraudsters have been exploiting DeepSeek’s reputation, running schemes involving fake cryptocurrency tokens and unauthorised AI hardware transfers. These incidents highlight the increasing risks in the AI and blockchain industries.
One of the major scams involved a fraudulent Solana-based token falsely linked to DeepSeek. The scam token’s value briefly surged to a $48 million market capitalisation, with trading volume exceeding $150 million. Over 22,000 wallets held the token before its price collapsed, causing significant financial losses. Despite DeepSeek officially denying any involvement in cryptocurrency, scammers capitalised on AI hype, misleading investors into believing they were part of an innovative project. This was a textbook pump-and-dump scheme, where fraudsters artificially inflated the token’s price before exiting with the profits.
In a separate case, Singaporean authorities have charged three individuals with fraud linked to the illegal transfer of Nvidia AI chips to DeepSeek. The suspects allegedly provided false information about the chips’ end-users, sparking concerns about a possible smuggling network between Singapore and China. This case is part of a broader crackdown on the unauthorised trade of high-performance AI hardware, a growing issue as demand for computing power increases globally.
These incidents underscore the vulnerabilities within the AI and crypto sectors. Fraudsters often exploit market excitement and new technologies to attract victims, promising unrealistic profits while operating without oversight. As AI and blockchain gain mainstream attention, authorities are stepping up efforts to combat fraudulent schemes.
Regulatory agencies are urging investors and businesses to conduct thorough due diligence before engaging in AI or blockchain projects. With scams linked to DeepSeek continuing to emerge, authorities are intensifying investigations and strengthening measures to prevent further financial fraud.
About the author
Anjali Kochhar covers cryptocurrency and blockchain stories in India as well as globally. Having been in the field of media and journalism for over four years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
