Mike Selig

We are evaluating things like innovation exemptions to allow for on-chain markets to flourish here in the US, even though some of our statutes really are focused on pushing that onto centralized gatekeepers and exchanges.

But it's important to have the right investor protections, have customer protections there.

And so even if someone's able to take their assets in self custody, perhaps we're regulating certain points of the flow of the transaction.

Well, it's such groundbreaking technology that we really have to make sure we get it right.

I'm concerned that we over-regulate and strangle some of the technology here in the United States.

I'm taking a very much minimum effective dose of regulation approach where we're looking at what's happening in terms of the models and how they're being deployed and used.

and making sure that we're regulating the actors, the persons that are engaging in the regulated activity and not just software developers.

The software developers are the ones building the tools, but they're not actually engaging in the financial transactions or using it to engage in regulated activity.

There was a great court case that dealt with actually Uniswap, the decentralized exchange protocol, talking about how you don't go after Tesla for the self-driving car that is used to rob a bank.

You're going after the bank robbers.

We're certainly looking to make sure we're regulating the traders, the persons that are using them.

For example, if you use a software tool to help you engage in trading activity, the trading activity is still regulated, but you're using a tool just like you're using your personal device or your computer.

So we're trying to get that regulation right.

And there are a lot of considerations as we're doing it.

But one area that I find fascinating is these kind of autonomous agents that are engaging in their own trading activity, potentially for their own kind of benefits.

So you could put a bunch of funds in a smart contract and let the smart contract kind of run on its own.

And that might actually be attached to a very sophisticated AI, and it's able to make better predictions on outcomes than anybody else.

And that's going to help us generate better data.

And so I think we're going to see a lot of competition between these different AI models on the financial scale in the prediction markets in other areas.

And that's where I think you see the marriage of blockchain, prediction markets, and AI.