Fed's Waller: Fed is talking to banks about managing AI risks

Coin World reported that Federal Reserve Governor Waller said on April 20 that as more and more financial institutions use artificial intelligence for customer service applications, fraud monitoring and underwriting, the Federal Reserve and the banks it supervises must manage risks related to artificial intelligence. There were "regular discussions". Waller warned that while AI could bring new efficiencies to banking processes, it also involved new risks. Waller also said that so-called smart contracts — or self-executing transactions on a blockchain whose outcome depends on preprogrammed inputs — could hold “considerable promise” for the modernization of transaction settlements. However, he noted that smart contracts also pose risks, such as network vulnerabilities.