On the back of any major tech comes the wave of scammers, and the rise of ChatGPT and other AI-powered tools is no different. Throw crypto and Elon Musk into the mix, and you've got yourself a heady-buzzword-scam brewing.

It's no wonder the authorities are giving serious attention to TruthGPT Coin, a cryptocurrency labeled as an "Artificial Intelligence investment scam" by Texas State regulators. It has called for the scam crypto promotion to halt immediately—but what is TruthGPT Coin, anyway?

What Is TruthGPT Coin? Why Are There Two TruthGPT Coins?

There are two projects using the name "TruthGPT Coin." One uses the Binance Smart Chain, while the other is an Ethereum ERC-20 token, but both appear to use the $TRUTH ticker. It's not clear if there is a specific link between the projects, as the general approach of each differs in quality.

The first project claims to be powered by an AI model developed in-house called Elon Musk AI. The TruthGPT website is full of images of Musk, poor-quality digital images, fake endorsements, and more (along with other prominent crypto figures, such as Binance's Changpeng Zhao). After signing up, you can ask the "AI" questions, but the responses are extremely slow and look to me to be hand-written in places. You'll also find fake accounts for big names in crypto, like Elon Musk, Satoshi Nakamoto, and Michael Saylor.

The project whitepaper is vague, contains no information on tokenomics, doesn't give any information on who is running the project, and raises several other scam project red flags.

Now, the second TruthGPT Coin has linked itself to Elon Musk's TruthGPT AI project to gain a semblance of legitimacy, though it notes that TruthGPT Coin is a community effort and isn't affiliated with Musk. It doesn't feature any Musk imagery but talks about him throughout the site and claims to use artificial intelligence to "seek out and evaluate information in order to arrive at the most accurate and reliable understanding of the world."

Is TruthGPT Coin a Scam?

The allegations levied against TruthGPT Coin certainly make it appear so.

The Texas State Securities Board issued an immediate cease and desist order to TruthGPT Coin, though this appears to be direct at the first website featuring the so-called Elon Musk AI rather than the second TruthGPT Coin, which is focusing on the TruthGPT AI.

According to the Texan regulators, the developers of the token, The Shark of Wall Street and Hedge4.ai, have a history of fake initial coin offerings and promoting scam coins.

The Shark of Wall Street and Hedge4.ai.have previously engaged in a series of initial coin offers (ICOs), deploying tokens on the Ethereum blockchain and Binance Smart Chain. They allegedly touted the profitability of the tokens through internet websites and social media, claiming an early offering was tied to a “money making machine Artificial Intelligence Lab,” another cryptocurrency related to an African diamond and gold mining project, and a different asset had “the potential to go 1000x. Not 100x. Not just 100x. It’s 1000x.” The respondents also allegedly told investors they could stake certain tokens to earn even greater profits – as much as 2000% per year.

According to Decrypt, other state regulators are backing Texas' cease and desist order, including the Alabama Securities Commission, the Montana State Auditor, the Kentucky Department of Financial Institutions, and the New Jersey Securities Bureau.

The TruthGPT Coin entry on CoinMarketCap also suggests something fishy is going on. It currently displays a banner informing would-be users that, "According to Gopluslabs, the smart contract of the following asset can be modified by the contract creator (for example: disable selling, change fees, mint new tokens, or transfer tokens). Please exercise caution before taking any action and DYOR."

Watch Out for Scam Tokens Involving ChatGPT, AI, and Elon Musk

ChatGPT launched in late 2022. Since then, we've seen numerous crypto scams attempt to leverage OpenAI's chatbot and the explosion in AI technology. Then, when Elon Musk announced his TruthGPT as a counterweight to perceived bias in ChatGPT and other AI chatbots, it added another angle for scammers, the allure of using Musk's name, crypto, and AI providing a potent combination.

For now, there is no official ChatGPT or OpenAI cryptocurrency. Furthermore, for all of Musk's flirtation with Dogecoin and other cryptos, he has never put his name to a token, and the Elon Musk AI tool is just ripping his name off, hoping its use will distract users from what's really going on.

Unfortunately, many more scams using this trio of topics will appear, and not all of them will be called out by regulators, at least not always quickly enough to stop some folks from being parted from their cash. As ever, research as much as you can before even thinking about pulling out your wallet, and avoid anything claiming to be a ChatGPT or Elon Musk crypto like the plague.