Scam tokens surge following DeepSeek AI's viral success

In the wake of DeepSeek AI's rapid rise to prominence, malicious tokens associated with the company have surged dramatically.

Over the past 24 hours, at least 75 scam tokens have been created, marking a threefold increase from the previous day.

This trend mirrors similar spikes in fraudulent tokens following high-profile events, such as the launch of Donald Trump's memecoin earlier this month.

DeepSeek's AI application gained significant attention after its latest version was released on January 20, quickly climbing to the top of the Apple App Store.

However, this success has also attracted scammers looking to exploit the situation.

Oz Tamir, a research analyst at BlockAid, highlighted that scammers have developed a decentralised application that mimics DeepSeek's website.

This application features a “Connect Wallet” button that could potentially compromise users' crypto wallets if clicked.

Tamir emphasised the sophistication of these scams and urged users to remain vigilant.

Despite DeepSeek's warnings about these fraudulent activities, scammers have made notable gains.

Two fake tokens reportedly reached market capitalisations of $48 million and $13 million before losing traction.

The speed at which scammers are capitalising on trending narratives has raised concerns within the cryptocurrency community.

DeepSeek has distanced itself from any cryptocurrency initiatives, reiterating that it has not issued any digital assets and advising users to be cautious of potential scams.

The company stated in a pinned post on X that only one official Twitter account exists for communication and urged users to report any suspicious activity.

The overall cryptocurrency market has also been affected by these developments, experiencing a 5.5% decline in value within the same timeframe.

As DeepSeek continues to garner attention for its AI capabilities, the associated risks from scams remain a pressing concern for users and investors alike.