Gary Gensler, the Chair of the United States Securities and Exchange Commission (SEC), recently delivered a speech on the topic of artificial intelligence (AI). Rather than focusing on the latest advancements in chatbots and photo rendering, Gensler chose to reference the 2013 movie “Her” to highlight the potential benefits and risks of AI in the fields of finance and law. In the movie, Joaquin Phoenix’s character falls in love with an AI system voiced by Scarlett Johansson. Gensler used this fictional example to convey the potential threat that an AI system could pose to financial stability if it were to be relied upon by numerous financial institutions.
Gensler emphasized the importance of considering laws and regulations when deploying AI systems in the financial space. He expressed concern that if an AI system were to malfunction or make incorrect decisions, it could have serious consequences for the financial industry. To illustrate his point, Gensler referred to various movies dating back to the 1980s that showcased the potential impact of AI on the law.
While Gensler has been critical of the use of digital assets in traditional financial institutions, he has also acknowledged the potential benefits of advanced AI models for the SEC. In fact, he has warned that without proper safeguards, a financial crisis resulting from the widespread use of AI could be almost inevitable.
Gensler has been serving as the head of the SEC since April 2021 and is expected to remain in this position until 2026. During his tenure, the commission has taken enforcement actions against several crypto firms, including Binance, Coinbase, and Kraken.
In conclusion, Gary Gensler’s views on AI and its impact on the financial industry are shaped by his concerns about potential risks and the need for appropriate regulations. While he recognizes the potential benefits of AI, he emphasizes the importance of implementing safeguards to prevent any adverse consequences.