On May 19, 2023, a photograph appeared on what was then still called Twitter showing smoke billowing from the Pentagon after an apparent explosion. The image quickly went viral. Within minutes, the S&P 500 dropped sharply, wiping out billions of dollars in market value. Then the truth emerged: the image was a fake, generated by AI.

The markets recovered as quickly as they had tumbled, but the event marked an important turning point: this was the first time that the stock market had been directly affected by a deepfake. It is highly unlikely to be the last. Once a fringe curiosity, the deepfake economy has grown to become a $7.5 billion market, with some predictions projecting that it will hit $38.5 billion by 2032.

Deepfakes are now everywhere, and the stock market is not the only part o

See Full Page