Al-hyped ponzi scheme and the call for regulation

BENEATH the glittering promises of the cryptocurrency world, where AI hype shines brightest, lies a sinister truth: CryptoBridge Exchange (CBEX).

- SESONA MDLOKOVANA

This AI-powered Ponzi scheme has shattered and embittered countless African investors. Edwin, a Kenyan government worker, is just one of many victims, having lost $16,000 - borrowed money, shattered dreams, and bruised dignity. His isolated story is a symptom of a broader crisis, a digital swindle spreading unchecked across Africa's vulnerable investment landscape.

CBEX initially presented an enticing opportunity: an AI trading system guaranteeing monthly returns and attractive referral bonuses. Its appearance of legitimacy was crafted through a complex network of corporate identities and fraudulent certificates. The platform employed “brandjacking,” using the acronym of China’s Beijing Equity Exchange, a deceptive tactic designed to instill a false sense of security in investors.

The unfortunate reality is that these schemes exploit both the lack of technological awareness and the financial aspirations of ordinary Africans seeking to improve their economic standing.

Africa is no stranger to Ponzi schemes, but CBEX marks a disturbing new phase: the combination of cryptocurrency’s lack of transparency with the enticing appeal of artificial intelligence. Crypto scams globally siphoned off an estimated $9.9 billion last year alone, according to blockchain analysis firm Chainalysis — a staggering sum that underscores the profitability and prevalence of these fraudulent activities.