A coalition of Democratic representatives from the US House has urged SEC Chairman Gary Gensler to strengthen regulations surrounding the use of artificial intelligence in trading. They express concerns that AI agents, which execute trades for retail investors, currently operate without adequate oversight, potentially undermining market integrity.
Bill Foster and Brad Sherman, who spearheaded the initiative, argue that the growing influence of AI in investment decisions poses risks, as these services often function outside the established legal frameworks. They highlighted that AI firms could inadvertently facilitate conflicts of interest or market manipulation.
“AI firms largely operate outside the securities regulatory framework. It is crucial that these technologies do not become tools for concealing conflicts of interest or market manipulation,” the lawmakers stated.
The urgency of their appeal has been amplified by the increasing use of AI trading assistants, particularly in the cryptocurrency sector. For instance, Coinbase recently introduced a virtual assistant designed to offer trading advice, which raises questions about the accuracy of the algorithmic predictions made by such platforms.
