It is 'nearly unavoidable' that AI will cause a financial crash within a decade, SEC head says

• Gary Gensler warns that AI could cause a financial crash by the late 2020s or early 2030s.
• Calls for regulation to address how AI models are used by Wall Street banks.
• Describes the issue as a "cross-regulatory challenge." *Wall Street banks have been enthusiastic adopters of AI.
• Morgan Stanley launched an AI assistant based on OpenAI's GPT4.
• Some banks like Goldman Sachs, Deutsche Bank, and Bank of America have banned employees from using ChatGPT at work.

Gary Gensler, the chair of the U.S. Securities and Exchange Commission (SEC), is concerned about about the potential for artificial intelligence (AI) to trigger a financial crisis. Gensler told the Financial Times that it is "nearly unavoidable" that AI could cause a financial crash by the late 2020s or early 2030s. He emphasized the need for regulation that addresses both the AI models developed by tech companies and how these models are used by Wall Street banks. Gensler described the issue as a "cross-regulatory challenge" and noted that many financial institutions might be relying on the same underlying AI models or data aggregators.

Full article here