Senator Elizabeth Warren just dropped a bomb at an event at the Vanderbilt Policy Accelerator. Her message is clear: the current explosion of artificial intelligence bears "striking" similarities to the 2008 financial crisis. According to her, a single misstep from the sector could trigger a devastating domino effect on banks, pensions, and insurers.
The mirage of debt and the opacity of credit
Warren's pointing out a major imbalance. AI companies are spending and borrowing at a record pace, far outstripping their actual revenues.
The problem? They often go through opaque private credit funds, slipping under the radar of traditional regulators. For the senator, this "shady accounting" hides real risks:
Over-leverage: If AI revenues don’t skyrocket immediately, companies won’t be able to service their debts.
Systemic risk: The first major bankruptcy could trigger a technological "bank run" and destabilize the entire financial system.
"If AI companies can’t ramp up their revenues at lightning speed, they won’t be able to handle their massive debt loads." — Elizabeth Warren.
Towards an "AI Glass-Steagall"?
Warren's analogy is visual: she compares AI to a climber tethered to local banks and pension funds. If the climber falls, they take everyone down with them.
Her solution is radical: "Cut the cord." She proposes strict measures to isolate the financial system from AI risk:
Risk separation: Legislation inspired by the Glass-Steagall Act to protect commercial banks from risky AI investments.
New Regulator: Creation of a digital agency dedicated to antitrust, privacy, and consumer protection.
No Bailout: She urges Congress to reject any future public bailout plans for the AI sector.
A regular in regulation (and crypto)
It’s no surprise for the Web3 ecosystem. Elizabeth Warren is known for her hardline stance on financial oversight. She is notably behind the anti-money laundering law for digital assets (2022) and actively advocates for strict regulations on the crypto market, tokens, and the behavior of public agents in these markets.
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DeFi: TRON connects USDT ($85 billion) to LI.FI to boost cross-chain interoperability.
#AI #Régulation #Finance #Warren #CryptoNews
