Bloomberg reported on May 3 that regulators in Texas are cracking down on the individual behind two cryptocurrencies that aim to capitalize on Elon Musk’s AI projects. The two tokens are called Elon Musk AI Token and TruthGPT Coin, with the latter named after Musk’s proposed ChatGPT competitor of the same name.
Joe Rotunda, enforcement director for the Texas State Securities Board (TSSB), has alleged that the tokens are “part of a fraudulent securities scheme” and issued a cease-and-desist order in conjunction with other states.
The TSSB’s filing names San Francisco resident and entrepreneur Horatiu Charlie Caragaceanu as the promoter of both assets. Caragaceanu claims that the tokens are powered by a trading platform that uses an AI algorithm developed by Musk to create trading strategies.
However, Musk has not created any such system. The TSSB’s filing also names Caragaceanu’s company, The Shark of Wall Street, as a promoter of the assets.
The regulator noted that Caragaceanu’s earlier assets, including various NFTs and a Shark of Wall Street token, have lost their value. In recent months, numerous crypto projects have attempted to capitalize on trends related to ChatGPT and other AI projects, including fraudulent examples of ChatGPT honeypot tokens.
On May 2, digital artist Rhett Mankind created a meme coin using AI that saw $26 million in trading volume on Uniswap over 24 hours.
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