Chinese Models Are a Big ‘Wrinkle’ for US AI Firms, Gensler Says

The former head of the US Securities and Exchange Commission warned about looming hurdles for artificial intelligence companies, citing competition with Chinese models and the potential for guardrails.

Gary Gensler said Tuesday in an interview on Bloomberg Radio that there are safety issues, pointing to when OpenAI models breached the technology firm Hugging Face earlier this year. He noted concerns around AI’s capabilities and said while it is possible to put up safeguards, competition with China presents a “big, consequential wrinkle.”

Leaders in the industry called for slowing the development of their most advanced models earlier this month, an idea that was quickly rejected by Donald Trump. The president has since rejected a push for an international agreement to put up guardrails around AI.

“This is a real challenge, I know the president calls it a hoax,” Gensler said, referencing Trump’s statement dismissing fears about AI. “I differ with the president on that.”

Gensler said US AI companies are “spending so much,” but questioned whether the revenues justify that spending. He said even though the US is leading in the space there is the potential for US companies to use Chinese competitors.