The SEC Chairman drew a line and promised to strike a blow to artificial intelligence if he crossed it. According to his statements, SEC Chairman Gary Gensler closely monitors the artificial intelligence ecosystem. Accordingly, he says the commission will smash any market manipulation efforts.
SEC President talked about artificial intelligence regulation!
The United States Securities and Exchange Commission (SEC) enforcement actions know no bounds. This time, emerging technologies such as Artificial Intelligence (AI) are now on the commission’s radar.
SEC Chairman Gary Gensler recently talked about the potential of artificial intelligence to interfere with and disrupt market dynamics. However, he stated that this would draw the wrath of the SEC. Speaking before the National Press Club earlier this week, the President said that terrible actors could try to use artificial intelligence to influence US markets or scare the public. He noted, however, that this too would receive an appropriate response from the commission. Contrary to the contradiction most people fall into, Gensler stated that “under securities laws, fraud is fraud in any form.” In this context, the SEC Chairman shared the following on his Twitter account:
Malicious actors may try to use AI to influence our companies or intimidate the public. Make no mistake, under securities laws fraud is fraud. SECGov is focused on detecting and prosecuting any fraud that may threaten investors, capital formation or the markets at large.
Bad actors may seek to use AI to influence our mkts, or spook the public. Make no mistake, under the securities laws, fraud is fraud. @SECGov is focused on identifying & prosecuting any form of fraud that might threaten investors, capital formation, or the mkts more broadly.
— Gary Gensler (@GaryGensler) July 20, 2023
The Artificial Intelligence ecosystem is just taking shape. But after OpenAI’s chatbot, ChatGPT, we’ve seen very significant adoption and growth in this space. The advent of ChatGPT proved that there is no limit to what artificial intelligence can do. Experts say that in the next few years, the clear boundaries observed and such previous use cases that seemed insurmountable could be resolved by artificial intelligence.
Meanwhile, it passed both the Medical and Law exams of ChatGPT by a good margin. So there is a high probability of training bots to exploit the financial market. That’s why the SEC said it would be conspicuously frowned upon. The SEC Chair stated that the agency is doing its best to identify any ways in which markets can be abused or damaged and prosecute perpetrators accordingly.
Will crypto-related conflicts continue?
As you follow on Kriptokoin.com, the SEC has crashed many players in the crypto ecosystem. Now it remains unclear whether he plans to crack down on AI service providers. The past year has been particularly busy for the SEC. Because Kraken sued the crypto exchange and settled. It currently has an active lawsuit against crypto trading giants Coinbase and Binance respectively.
The latest XRP decision in the Ripple and SEC case is very important for the industry. Because the crypto world thinks it will shape other enforcement actions in the near future. In this context, there is a general belief that it sets a very important precedent. The artificial intelligence industry is just beginning to sprout. However, stakeholders may soon join those in the Blockchain ecosystem and call for a special arrangement to guide these emerging technologies.
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