Artificial intelligence (AI): SEC chairman expresses concern

According to Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC), Artificial Intelligence (AI) will be the cause of future financial crises. 

SEC and Artificial Intelligence (AI): Gary Gensler warns there will be financial crises

In an interview with Dealbook’s Ephrat Livni, Gary Gensler, the chairman of the US Securities and Exchange Commission (SEC), reveals his concerns on the topic of Artificial Intelligence (AI). 

Specifically, Gensler warns that the emerging technology will be at the center of future financial crises. 

His greatest fears involve generative AI tools such as ChatGPT that want to transform businesses and society. Not only that, Gensler indicated that some AI models may favor corporate interests over those of investors, leading to potential conflicts of interest. 

In this regard, the regulator appears to have already taken action on this issue, submitting a specific proposal to address these conflicts that could be embedded in the models. 

Gensler’s concern also affects investment advice that, using AI, could be erroneous. In this regard, the SEC chairman reportedly said:

“Investment advisers under the law have a fiduciary duty, a duty of care, and a duty of loyalty to their clients … And whether you’re using an algorithm, you have that same duty of care.”

SEC and Artificial Intelligence (AI): fake news about the Chairman’s resignation

The SEC Chairman seems to be trying to protect companies and investors from AI technology. 

Indeed, Gensler would also point out that parameters are set by the humans who built the models, and that companies and users should not delegate all responsibility to AI. 

The concerns of the SEC Chairman may not be so unfounded, since he himself had been a victim of AI. 

Indeed, early last month, through an AI platform, news had spread that Gensler would resign, following an internal investigation. 

Given the “climate of hatred” that exists between the crypto worlds and the regulator, the news was highlighted and taken as true even by some news outlets. In reality, the source was not authoritative, and unmasking the platform generating the “lie” was FOX Business Network (FBN) correspondent Charles Gasparino. 

In this regard, the analysis of the text had been carried out by ZeroGPT, an AI-generated text detector, which found that 96.8% of the news had indeed been generated by an AI tool. 

The problem that has arisen is that AI tools that produce texts, such as ChatGPT, do not take into account the reliability of sources, or at any rate are not yet able to verify authoritativeness. 

AI is already a reality

There are already many companies that have AI tools in place. Among the many is Bitget‘s crypto-exchange, which has already announced its AI feature for grid trading strategies. 

In this case, the emerging technology will act on quantitative strategy that uses trading algorithms to automate users’ transactions. 

Not only that, the likes of Microsoft and Amazon are also exploring AI. 

In fact, last month, Microsoft partnered with Axelar to offer new blockchain-based interoperability solutions, and to make AI more widely available through the Azure marketplace. 

Meanwhile, Amazon has invested $100 million for the new AWS Generative AI Innovation Center, which will support customers to conceive, design and launch new AI-based products and services. Even Elon Musk, CEO of Tesla and SpaceX, and owner of X (Twitter), has launched xAI, the viable alternative to ChatGPT that wants to use technology to understand the true nature of the Universe.