Financial regulators in several US states at once issued a warning that the YieldTrust.ai trading platform has all the signs of a Ponzi scheme and banned the application in their states.
Regulators in Montana, Texas and Alabama signed the corresponding statement. They accused the platform YieldTrust.ai and its Romanian founder Stefan Ciopraga of fraud.
The developers of the YieldBot platform and trading decentralized application claimed to use “advanced artificial intelligence”, thanks to which a trading bot can “make 70 times more transactions and make a profit 25 times higher than any trader.” The platform promised income up to 2.2% per day. The regulators emphasized that there is no evidence of such profitability, as well as the actual existence of the trading bot.
Regulators have hired a third-party firm to audit the YieldBot smart contracts that run on the BNB Smart Chain. According to the auditors, smart contracts can be called “dangerous, as the developers have retained significant control over user funds and can block the withdrawal of assets.”
“Artificial intelligence can be an exciting opportunity, but scammers are trying to capitalize on the popularity of this technology. They are developing high-tech schemes to deceive investors,” said Montana Regulatory Commissioner Troy Downing.
The Montana Securities Commission imposed a ban on YieldTrust.ai and fined $100,000. After that, the scammers immediately stopped the application, which is confirmed by statistics on the DappRadar portal. They also deleted their Twitter account. However, it is not known if the users of the platform were able to withdraw their funds.
Another similar scam was recently reported. DApp developers using AI Harvest Keeper fled with user assets. Fraudsters stole about $1 million.
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