As AI deepfakes advance, identity checks on cryptocurrency exchanges are at risk

Updated: 24 April 2024

Disclosure

Don’t invest unless prepared to lose all the money you invest. This is a high-risk investment, you shouldn’t expect to be protected if something goes wrong.

Join Our Telegram channel to stay up to date on breaking news coverage

A rising number of people are worried about identity verification methods on cryptocurrency exchanges as artificial intelligence (AI) develops. Deepfake proofs of identification are now simpler to create than ever because to the quickly developing AI technology. Some well-known industry executives have spoken out on the worries about hazards in crypto that are facilitated by AI.

Why have to concern about AI-generated avatar?

On August 9, Binance’s CEO and founder Changpeng Zhao took to Twitter to warn about the use of AI in cryptocurrency by malicious parties. Zhao said:

From the standpoint of video verification, this is quite ominous. Even if someone sends you a video, don’t send them coins.

Binance’s internal Know Your Customer (KYC) procedures demand cryptocurrency investors to produce video evidence in order to execute some transactions, just like many other cryptocurrency exchanges.

Joshua Xu, co-founder and CEO of HeyGen, is featured in an AI-generated film cited by the CEO of Binance. The video specifically featured Xu’s AI-generated avatar, which accurately portrayed the genuine HeyGen CEO’s appearance and voice and speaking habits.

Both of these video snippets, which feature his own avatar and voice clone, were entirely artificially created, according to Xu. In order to replicate his distinctive accent and speech patterns, he continued, HeyGen has advanced with some significant improvements to the video quality and audio technology of its lifestyle avatar. Xu said “This will soon be put into use, and anyone can test it out.”

Once it is made available to the general public, the AI tool will enable anyone to construct a digital avatar that is as realistic as possible in just “two minutes,” according to the HeyGen CEO.

For cryptocurrency exchanges like Binance, the public’s exposure to AI generating tools like HeyGen might possibly lead to major identity verification problems. Similar to many other exchanges, Binance uses KYC procedures that entail sending a video of the user and specific papers in order to gain access to services or even to withdraw money from the site.

Users must submit the statement video on Binance along with a photo of an identity document, such as a passport, ID card, or driver’s license. Users are required by the rules to include the date and specific requests on the video record. The guideline states, “Please do not watermark your videos and do not edit your videos.”

Jimmy Su, the chief security officer at Binance, has previously expressed concern about risks related to AI deepfakes. Su made the claim that AI technology is progressing to the point that human verifiers may soon be unable to detect AI deepfakes in late May.

This is pretty scary from a video verification perspective. Don't send people coins even if they send you a video… 🤷‍♂️ https://t.co/jvjZGHihku

— CZ 🔶 Binance (@cz_binance) August 9, 2023