According to Bijiie, the 2025 COAI token collapse wiped out $116.8 million in value from C3.ai and exposed systemic vulnerabilities in DeFi. The fraud was fueled by unstable leadership, regulatory ambiguity, and technical flaws in algorithmic stablecoins like xUSD and deUSD. The incident underscores the urgent need for robust due diligence and risk management in the crypto space. Experts emphasize four pillars of risk management: financial transparency, technical security, team legitimacy, and regulatory compliance. The COAI scandal has had a chilling effect on investor confidence, particularly in algorithmic stablecoins and DeFi protocols. A 2025 report estimates illegal crypto activity remains a $45 billion problem, with fraud and scams accounting for 24% of illicit volume. Despite a 40% decline in scam inflows compared to 2023, fraud tactics are becoming more sophisticated. The incident also highlights the growing threat of ransomware and infrastructure attacks, with $2.2 billion stolen in 2024. To rebuild trust, the industry must adopt proactive risk management, including standardized due diligence checklists, diversification, and real-time monitoring tools like DexTools and GoPlus Security.
COAI Token Scandal Highlights Systemic Risks in DeFi and Investor Trust
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