Public Statements & Remarks

Statement by Commissioner Summer K. Mersinger before the Technology Advisory Committee Meeting

July 18, 2023

Good afternoon and thank you to Commissioner Goldsmith Romero for hosting another meeting of the Technology Advisory Committee (TAC). I regret not being able to join today’s meeting in person. I have no doubt that the presentations and discussions during today’s meeting will be educational not only to the Commission, but to everyone on the committee, those participating in today’s presentations and anyone joining us in-person or virtually.

July has become the month of advisory committee meetings here at the Commodity Futures Trading Commission (CFTC), with four separate committees holding meetings almost back-to-back (five if you count the Energy and Environmental Markets Advisory Committee meeting I sponsored at the end of June).

As a regulator who has to remain up-to-speed on a wide variety of topics at the same time, advisory committee meetings are a great opportunity to hear directly from experts and learn about matters important to the work we do here at the CFTC. The information and discussion occurring at these meetings is far beyond anything we could obtain on our own through reading reports, white papers, etc.

But, as a Commissioner who enjoys sharing remarks at the start of these meetings, I have to admit, I’m running out of material. Since this statement is before the advisory committee devoted to technology, I decided to enlist the help of a few people in my life who are very adept at using technology – my children. Not only did they provide thoughts and ideas for my statement, they also confirmed that this was the first time anything about my job has been interesting to them.

I asked three of my four children for their thoughts on Artificial Intelligence (AI) and Decentralized Finance (DeFi). My panel was missing one child because my 16-year-old daughter now has her driver’s license, is never home, and cannot be bothered by silly conversations with family members. My expert panel included two elementary-school aged boys, so not all comments were deemed appropriate for public consumption. However, I will share some of the comments that made the cut.

When asked about AI, my youngest told me he had no idea what that means so I explained it as the computer thinking on its own, making conclusions based on the information it has available. An avid football fan, this 10-year-old son responded to my inquiry and simplistic explanation of AI with a pretty shrewd question of his own: “So, when I ask the computer who the best quarterback is in the NFL and it says Patrick Mahomes, is that because it thinks it should say he is the best because the computer knows he is my favorite quarterback, or is it just a fact that Patrick Mahomes is the best quarterback?

My 12-year-old son and 14-year-old daughter were a little more familiar with AI. In fact, I learned a new term from my 12-year-old – Non-Playable Characters, or NPCs as they are known in the gaming world. I asked him to explain NPCs and how they use AI. He said I wouldn’t understand. Fair enough!

My 14-year-old daughter offered another example of AI that was also new to me, this time in the context of social media. She told me that she likes to text “SnapChat AI” because “It reads my texts, it texts back immediately with something I want to hear, and it doesn’t ghost me like my last boyfriend did on SnapChat.”

The conversations regarding DeFi were much less substantive. DeFi seems to be a concept they have yet to grasp.

My youngest son said he doesn’t know what that means and ended the conversation by returning to his video game.

My 12-year-old son said: “Like cryptocurrencies and those gorilla NFTs? That’s dumb. Why does anyone use real money to buy fake money?”

I followed up with an example suggesting that when he buys tokens on his favorite video game with his birthday money, he is essentially buying fake money with real money. He responded, “Yeah but that’s different because I can buy cool weapons.”

And my 14-year old said: “What, like Venmo? I like Venmo because you can like send me money when I want it.”

I do not report these admittedly unscientific survey results to be glib about the issues that are on the agenda for us today. Just the opposite. AI and DeFi (and I’ll add cybersecurity, too) are not hypothetical challenges of the future for financial markets and those who regulate them – rather, they are here now. Yet they come wrapped in new concepts and terminology that often seem just as foreign to many of us as they are to my young kids.

Thankfully, we will hear from real experts today who will discuss, explain, and analyze these important topics and more. I am certain we will all walk away from today’s meetings much smarter, and much better prepared to consider the impact of these technological advances on the markets we regulate at the CFTC.

I am also looking forward to reviewing any work product from the three TAC subcommittees - Digital Assets and Blockchain Technology, Emerging and Evolving Technologies, and Cybersecurity – especially in areas where we may need to take a second look at our regulations to make sure they remain fit for purpose.

As always, thank you to all of the CFTC staff who make sure these meetings are a success. I believe I speak for my fellow commissioners when I tell you, these meetings cannot happen without you.