Australia's financial regulator has shut down more than 3,100 cryptocurrency scam platforms as part of a broader crackdown on investment fraud that saw the removal of over 19,400 online scams in a single fiscal year, with authorities warning that artificial intelligence is making fraudulent schemes increasingly sophisticated and harder to detect.
The Australian Securities and Investments Commission reported that in fiscal year 2026 it took down 19,400 online investment scams, a 182% increase from the previous year. Of those, 3,106 were fake cryptocurrency platforms designed to defraud Australian investors. The surge in scam activity has been driven by the use of generative AI to create deepfake videos, fake websites, and fraudulent social media profiles at scale.
How AI Is Supercharging Crypto Scams
ASIC's warning highlights how generative AI has transformed the scam landscape. Scammers are using AI to create deepfake videos of prominent figures, including Australian Prime Minister Anthony Albanese, to lend credibility to fraudulent investment schemes. These deepfakes have fueled over $5.3 million in documented losses, with victims believing they are investing in legitimate cryptocurrency platforms endorsed by public figures.
The scale of AI-powered scam operations is unprecedented. A single scammer can now create hundreds of fake websites and social media profiles using automated tools, whereas previously each scam required manual effort. ASIC has removed more than 25,000 investment scam and phishing websites since launching its takedown service in 2023, but the agency warns that the pace of new scam creation is accelerating. For more on crypto security threats, see our coverage of the Coldcard theft investigation.
The Scale of Australian Crypto Fraud
Australians lost approximately AUD 2.18 billion to investment scams in the most recent fiscal year, according to ASIC data. Cryptocurrency scams represent a significant portion of these losses, as the promise of high returns from digital assets continues to attract investors, including those who may not fully understand the risks. The 3,106 fake crypto platforms taken down by ASIC represent only the scams the regulator was able to identify and remove, suggesting the actual number of fraudulent crypto operations targeting Australians may be higher.
The losses underscore the challenge of protecting retail investors in a market where legitimate investment opportunities coexist with sophisticated fraud schemes. ASIC has emphasized that a quick online search is no longer sufficient to verify investment opportunities, as AI-generated websites and social media profiles can appear convincing and professional. For more on crypto fraud enforcement, see our coverage of the crypto Ponzi mastermind case.
The Regulatory Response
ASIC's approach to combating crypto scams combines proactive takedowns of fraudulent platforms with public education campaigns. The regulator has been working with internet service providers, social media platforms, and domain registrars to identify and remove scam websites. However, the 182% increase in scam takedowns suggests that the problem is growing faster than enforcement efforts can address.
The Australian government has also been developing regulations for cryptocurrency businesses operating in the country. The regulatory framework aims to provide consumers with greater protections while allowing legitimate crypto businesses to operate. Nexo's recent launch of regulated crypto-backed credit lines in Australia, following ASIC credit authorization, demonstrates that the country is working to create a regulatory environment that supports legitimate crypto businesses while cracking down on fraud. For more on Australian crypto regulation, read our coverage of Nexo Australia's launch.
What This Means for Crypto Investors
ASIC's findings serve as a stark warning for cryptocurrency investors. The use of AI to create sophisticated scams means that investors must exercise greater diligence when evaluating crypto investment opportunities. The regulator recommends verifying investment platforms through official government resources rather than relying on online advertisements, social media posts, or celebrity endorsements.
The 3,106 fake crypto platforms taken down by ASIC represent a fraction of the global scam landscape. Cryptocurrency investors worldwide face similar risks, and the use of AI by scammers is not limited to Australia. As generative AI tools become more accessible, the sophistication and volume of crypto scams are likely to increase, making investor education and regulatory enforcement increasingly critical. For more on AI and crypto risks, read our coverage of AI and crypto privacy concerns.
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