No Framework
As of this writing, there is no US federal regulatory framework specifically governing AI-driven trading models, their training data, or their behavior in stressed markets. The EU's AI Act is the closest analog, but carves out most financial applications.
The pattern from every previous era says a major AI-trading incident is a prerequisite for regulation — not a preventable outcome of it. The open question is only whether that incident will be a ‘flash crash’ or something worse.
07 · AI Trading
AI systems are trading trillions. Large language models are reading news feeds and adjusting positions in milliseconds. No specific federal framework governs this class of behavior. The largest regulatory gap in financial history is being created in real time — and it is on track to be the longest-lived.
Read the full era →