CBEX and the Emergence of AI-Enhanced Cryptocurrency Scams

The article discusses the emergence of AI-powered scams in the cryptocurrency sector, focusing on CBEX, which enticed Nigerian investors with false promises of high returns through AI trading features. Following a halt in withdrawals, countless investors faced significant losses, leading to investigations revealing CBEX’s deceptive practices. The article contextualises CBEX within a broader trend of cryptocurrency fraud while highlighting regulatory responses from Nigeria’s SEC and the role of economic vulnerability in such scams.

The rise of AI-powered scams has become increasingly prevalent, particularly in the cryptocurrency sector. Scammers exploit advanced technologies, such as deepfake influencers and sophisticated bots, to deceive individuals. A notable example is CBEX, which promised investors 100% returns within a mere 35 days by utilizing an AI-driven trading feature that operated through a Telegram group, misleadingly portraying the potential for substantial gains.

Initially, CBEX appeared legitimate, featuring fake trading logs and user-friendly dashboards, allowing withdrawals for investors. However, the situation deteriorated when a sudden halt on withdrawals occurred between 9th and 15th April 2025, resulting in a complete loss of investor balances. CBEX and its group, ST, attributed their failures to hackers and subsequently introduced a so-called “compensation program,” which required victimised users to pay additional fees to access their own funds.

Investigations into CBEX revealed it was not just a typical Ponzi scheme, but a well-crafted illusion employing modern AI technology to create a façade of legitimacy. The platform falsely claimed affiliation with the China Beijing Equity Exchange and utilised AI-generated trading records, automated customer service, and counterfeit social media endorsements to mislead investors. The ST group effectively encouraged participation through gamification and referral incentives, mirroring traditional Ponzi mechanics enhanced by generative AI.

This sort of scam is not isolated; there have been multiple high-profile cases globally. For instance, Mirror Trading International in South Africa vanished after promising AI-driven forex trading and stealing over $1 billion. OneCoin, led by Ruja Ignatova, raised $4 billion without a functioning blockchain, and PlusToken swindled $3 billion from Chinese investors by falsely promoting an algorithmic trading system. The difference now lies in the scalability and velocity of AI, making it cheaper and easier for scammers to operate worldwide.

In response to these scams, Nigeria’s SEC is moving to strengthen regulations. On 14th April, SEC DG Emomotimi Agama warned stakeholders that unregistered platforms are illegal. The newly enforced Investment and Securities Act allows for significant fines and prison sentences for Ponzi scheme promoters, signalling rigorous enforcement, including liabilities for social media influencers endorsing scams.

The underlying issue remains Nigeria’s economic vulnerability, driving individuals to seek quick wealth in desperate circumstances. For many, joining CBEX was motivated by financial need rather than greed. Therefore, scams like these exploit not only monetary investments but also the hope for a better future. As history teaches, if an opportunity appears too good to be true, it likely is. For the victims of CBEX, the possibility of recovering their investments currently remains uncertain.