FIA cautions CFTC on regulation of AI

24 April 2024

  • FIA recommends “technology-neutral” approach to regulation
  • FIA says CFTC should focus on "outcomes and use cases" rather than AI itself
  • FIA letter joined by CME, ICE and FIA PTG

Washington, D.C. – FIA today responded to a request for comment from the Commodity Futures Trading Commission on the uses of artificial intelligence in derivatives markets.

FIA welcomed the CFTC's decision to seek feedback from the public before determining whether additional regulation is needed, and encouraged the agency to continue gathering information to help it better understand the current and potential uses for AI as well as the risks that may arise.

FIA urged the CFTC to take a "technology-neutral" approach and focus on "outcomes and use cases" rather than the technology itself.

FIA also urged the CFTC to consider the applicability of its existing rules and regulations before presupposing that new, AI-specific regulations are needed.

"In many instances, existing CFTC rules and guidance provide the controls and oversight needed for the CFTC to promote and protect the integrity and resilience of our markets," the letter said. "We believe that the CFTC’s risk-based approach to developing a regulatory framework around outcomes and use cases, rather than the underlying technology, likely means that the CFTC’s existing rule sets already address perceived risks."

FIA's letter was co-signed by CME Group and Intercontinental Exchange, which are the parent companies for several exchanges regulated by the CFTC, and the FIA Principal Traders Group, which represents firms that trade their own capital in exchange-traded markets.

The CFTC's request for comment was issued in January. CFTC Chairman Rostin Behnam said when the request was issued that it would allow the agency "to better align our supervisory oversight and evaluate the need for future regulation, guidance or other Commission action."

FIA is the leading global trade organization for the futures, options and centrally cleared derivatives markets, with offices in Brussels, London, Singapore and Washington, D.C. FIA’s membership includes clearing firms, exchanges, clearinghouses, trading firms and commodities specialists from about 50 countries as well as technology vendors, law firms and other professional service providers. FIA’s mission is to support open, transparent and competitive markets; protect and enhance the integrity of the financial system; and promote high standards of professional conduct. 

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