Spotify has removed an AI impersonator of popular Australian rockers King Gizzard and the Lizard Wizard from the streaming service, with the band’s frontman voicing despair at the situation.

King Gizzard removed their music from Spotify in July in a protest against the company’s chief executive Daniel Ek, who is the chair of military technology company Helsing as well as a major investor.

Clearly attempting to fill the void, earlier this month a new artist appeared on Spotify called King Lizard Wizard, featuring AI-generated takes on the band’s psychedelic rock, identical song titles, and AI-generated artwork that weakly imitated the band’s fantastical album sleeves.

Spotify has now removed King Lizard Wizard from its service, saying: “Spotify strictly prohibits any form of artist impersonation. The content in question was removed for violating our platform policies, and no royalties were paid out for any streams generated.”

Stu Mackenzie, King Gizzard’s frontman, said he was “trying to see the irony in this situation” after the band’s earlier departure from Spotify, but added: “Seriously wtf – we are truly doomed.”

AI-generated music is proving to be hugely contentious, and has quickly become one of the most discussed issues in the music industry.

In September, Spotify announced it had removed 75m tracks thought to be made by AI artists last year, as fraudsters attempt to generate income by flooding the platform with fake artists who can generate royalty payouts. There have also been instances of “deepfake” versions of popular artists such as Drake being uploaded online.

But while most of these tracks are caught in spam filters and never make it on to the platform, or are swiftly removed if they do, AI-generated or enhanced music is likely to become more popular.

Currently in the UK Top 40 is I Run by British dance duo Haven, whose original version featured AI-manipulated vocals. Haven’s Harrison Walker admitted to using AI, saying: “As a songwriter and producer I enjoy using new tools, techniques and staying on the cutting edge of what’s happening.” The song became a viral success but was removed from streaming services after takedown requests from labels and industry bodies alleging that the voice generated by AI too closely imitated British singer Jorja Smith.

Haven then rerecorded I Run with human vocals, though Smith’s label Famm alleges that both versions “infringe on Jorja’s rights and unfairly take advantage of the work of all the songwriters with whom she collaborates”. Haven have not responded to Famm’s claim.

AI-generated music is anticipated to enter the mainstream, though, when the tools become available to the general public. In recent weeks, major labels Universal and Warner have struck deals with the companies Udio and Suno, which will allow users to create AI music from the work of real artists signed to those labels (with artists able to opt in and out of making their music available).

Speaking to the Guardian this week, Eurythmics producer Dave Stewart described AI in music as an “unstoppable force”, and argued: “Everybody should be selling or licensing their voice and their skills to these companies.”

But others have voiced concern. After the deal between Universal and Udio, Irving Azoff, founder of the Music Artists Coalition in the US, warned that artists could “end up on the sidelines with scraps”, adding: “Every technological advance offers opportunity, but we have to make sure it doesn’t come at the expense of the people who actually create the music – artists and songwriters … artists must have creative control, fair compensation and clarity about deals being done based on their catalogues.”