Supposed AI-Based Crypto Token Using Elon Musk's Image Targeted by Texas Securities Board
Five U.S. states are ordering TruthGPT Coin promoters to cease and desist using images of Elon Musk, Changpeng Zhao and Vitalik Buterin to promote what they describe as an investment scam.
Texas and other U.S. state financial regulators have ordered a crypto "investment scam" purporting to use artificial intelligence (AI) to cease all activity in an order from Wednesday.
The scheme operated by Horatiu Caragaceanu, The Shark of Wall Street and Hedge4.ai markets coins known as truthGPT Coin (TRUTH). The token is using images of Tesla CEO Elon Musk, Binance Chief Executive Officer Changpeng “CZ” Zhao and Ethereum co-founder Vitalik Buterin, said the Texas State Securities Board, which was joined by counterparts in New Jersey, Alabama, Montana and Kentucky.
“Artificial intelligence is buzzing,” Texas Securities Commissioner Travis J. Iles said in a statement. “Bad actors continue their attempts to capitalize on this widespread public interest.”
The truthGPT coin claims to use machine learning to predict future crypto prices, and involves offering unregistered or non-permitted securities to Texas residents, the regulator said. Caragaceanu is based in California and Bucharest and has previously promised outlandish returns from coin offerings that now have zero value, it added.
Other ventures by Caragaceanu, The Shark of Wall Street and Hedge4.ai have also been named by the regulators, including the GPTX token and Hedge 4 non-fungible tokens (NFT).
The owner of Hedge4.ai’s Telegram channel told CoinDesk that the initiative is “not a scam investment” and that it does “not sell GPTX to Americans.”
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.