--This paper addresses the challenge of enhancing cybersecurity in Blockchain-based Internet of Things (BIoTs) systems, which are increasingly vulnerable to sophisticated cyberat-tacks. It introduces an AI-powered system model for the dynamic deployment of honeypots, utilizing an Intrusion Detection System (IDS) integrated with smart contract functionalities on IoT nodes. This model enables the transformation of regular nodes into decoys in response to suspicious activities, thereby strengthening the security of BIoT networks. The model focuses on understanding and predicting sophisticated attacks that may initially appear normal, emphasizing strategic decision-making, optimized honeypot deployment, and adaptive strategies in response to evolving attack patterns. The Internet of Things (IoT) has revolutionized numerous sectors through its vast network of interconnected devices. However, the rapid expansion of the IoT introduces significant security and privacy concerns, as these devices often have limited computational resources, making them vulnerable to attacks [1]. Traditional security solutions, which sometimes rely on centralized systems, encounter scalability issues and introduce further vulnerabilities [1], [2].