As companies adopt new technologies such as cryptocurrencies and AI, governments around the world need to amend existing laws to account for companies relying more on machines and less on humans, Jeremy Allaire, CEO of stablecoin giant Circle, said at the Fortune Global Forum on Monday.
“Most of our legal systems are not built on the idea that businesses themselves are run entirely by machines on the internet,” he added. “My own view is that over the next five years, and certainly within the next five to 10 years, almost every legal system in the world will have to become an economic system governed by machines.”
Allaire’s comments come as countries race to keep up with the breakneck pace of AI development and blockchain technology is increasingly adopted by major financial institutions.
Since January, all 50 U.S. states have introduced AI-related legislation, according to the National Conference of State Legislatures. That includes California, which passed a law in September that requires AI developers to publish requirements such as how they incorporate industry best practices into their models.
In parallel with the proliferation of AI-focused legislation, governments, particularly those in the United States, are prioritizing the passage of regulatory frameworks for cryptocurrencies. President Donald Trump signed a bill in July that spells out legal guardrails for stablecoins (virtual currencies pegged to an underlying asset such as the U.S. dollar). And the Senate is considering passing a broader bill that would govern the structure of crypto markets and include language about which federal agencies would regulate which classes of crypto assets.
The recent push for crypto legislation is a sign of improvement for the federal government, which has been cracking down on crypto companies under President Joe Biden, with industry backers arguing it is a form of “enforcement regulation.”
“There is a lack of regulatory clarity,” Jenny Johnson, CEO of asset management firm Franklin Templeton, said at the Fortune Global Forum, referring to the hurdles preventing large financial firms from adopting cryptocurrencies.
However, with the recent passage of the Stablecoin Bill and the upcoming negotiations on the Cryptocurrency Market Structure Bill, the situation appears to be changing. Traditional financial institutions such as Franklin Templeton and Standard Chartered Bank are now leaning more into digital assets, conducting transactions “on-chain,” or on the blockchain.
“We have the belief, and have had for a long time, that most, if not all, things will be resolved in a cascading way,” Standard Chartered CEO Bill Winters said at the event.
