On March 15, 2025, a significant incident occurred in the crypto world as Kaito AI, an artificial intelligence-powered platform for crypto market analysis, and its founder, Yu, were targeted in a social media hack on X (formerly Twitter). The hackers managed to take control of the account and falsely declared that Kaito AI’s wallets had been compromised, creating panic among users about the safety of their funds.
According to blockchain investigator Defi Warhol, the attackers went a step further by opening a short position on Kaito tokens before spreading the misleading information. Their motive seemed to be manipulating the token’s price downwards to profit from the ensuing decline.
Fortunately, the team behind Kaito AI acted swiftly to regain control of the compromised account and reassure users that their wallets were secure. They also emphasized the implementation of enhanced security measures to prevent such breaches in the future, noting the similarity of this attack to other recent cyber incidents targeting crypto entities.
In a statement, the company clarified, “This account and @Punk9277 were just compromised. The KAITO wallets were NOT and are NOT compromised. We now have regained access to the twitter accounts. Please bear with us as we investigate how this happened. We had high standard security measures in place to prevent it – so it seems to be similar or the same to other recent Twitter account hacks. We’ll update as soon as we can. To reiterate – KAITO token wallets have not been compromised.”
The surge in cyberattacks like these has resulted in a worrying uptick in losses within the crypto sphere. A report by blockchain security platform Immunefi revealed that losses in February 2025 were twenty times higher than in January 2025, with a notable rise in scams targeting investors.