It is reported that former Chairman of the U.S. Securities and Exchange Commission (SEC) Jay Clayton may be appointed as the person in charge of AI affairs in the United States. This position, combined with his past experience as a regulator of technological innovation, could potentially lead to some controversy.
Clayton was once responsible for overseeing emerging technologies at SEC, and is considered to have initiated the institution's approach to "enforcement and regulation" in the crypto industry, which included law enforcement cases targeting Ripple Labs.
The new AI transaction leader position doesn't seem to cover the encryption field as comprehensively as David Sacks did when holding that role initially.
Jay Clayton Since making its first foray into the crypto industry over a decade ago, this individual has been active in the public sector. Now, this person, who is often appointed by Trump, is reportedly on the verge of taking on the role of head of government affairs related to artificial intelligence.
If Clayton takes office, the responsibilities of this AI position as the person in charge of transactions will focus on the government's AI working group, with the aim of overseeing the rapidly growing domestic AI industry in the United States. However, it is not yet clear what specific tasks will be included in this role, as the president is attempting to address the concerns raised by those who warn about the increasingly complex issues related to machine intelligence security.
This position seems not to involve encryption affairs, despite the significant overlap between these two fields. Trump's first person in charge of affairs, David Sacks, was responsible for both areas at the same time. Sacks resigned from the role of head of encryption affairs in March, and since then, the White House's encryption work has been overseen by advisor Patrick Witt.
Clayton did not respond to CoinDesk's message. Previously, he served as the U.S. Attorney for the Southern District of New York, and later this year, he was appointed as Trump's Director of National Intelligence.
If he becomes a leader in this new technological landscape, the AI industry may take notice of his record in digital asset regulation.
The crypto industry has criticized the "law enforcement and regulation" stance of former SEC Chairman Gary Gensler during his tenure, a practice that can be traced back to the period when Clayton was in charge of SEC. Clayton was appointed as Chairman by Trump during his first term and launched a high-profile legal battle against Ripple Labs just before leaving office in 2020.
That is one of the major enforcement cases targeting a significant industry company by SEC. SEC accused Ripple of failing to register approximately $1.3 billion in XRP tokens as securities. (Later, another official appointed by Trump, the current chairman of SEC, suspended the case, and the institution abandoned further prosecution last year.) However, Ripple is merely the final chapter in Clayton's record of crypto enforcement during their tenure.
In 2017, he established the "Internet Department" ( Cyber Unit ) of SEC , which focused specifically on this emerging field and began to regulate initial coin offerings (ICOs) as well as other industry activities. By the time Clayton resigned in 2020, SEC released a report that outlined its enforcement record, which included 57 cases initiated by the agency against digital assets, blockchain companies, and initial coin offerings.
SEC indicates that these cases focus on 'the act of deceiving investors by utilizing digital asset securities, as well as violations of federal securities law registration provisions during the issuance and sale of digital asset securities.' This statement is not unfamiliar to industry insiders who later engaged in confrontations with SEC under the leadership of Gensler.
As a backdrop, Clayton's then boss, Donald Trump, maintained a skeptical attitude towards cryptocurrencies throughout his first term in the White House and thereafter. In an interview in 2021, when referring to "Bitcoin in the world," Trump stated, "I think they should have very, very strict regulation over it."
However, after Trump personally entered this field, he began to embrace digital assets. From initially getting involved with non-fungible tokens (NFTs), to launching a token themed around himself, and then to holding shares in certain digital assets. During the 2024 election campaign, Trump rebranded himself as a supporter of cryptocurrencies. After returning to the White House, he appointed his first chief of staff to oversee both cryptocurrency and artificial intelligence policies.
Today, it seems that the position of person in charge of this matter will shift to AI. Any encryption-related work at the White House may be entrusted to an advisor who is about to leave his or her post. In September, Trump compared the AI task force to the Space Force he established during his first term and stated that he would announce a person in charge of this matter, who will be a "highly intelligent" individual, "in the near future."
Before returning to the public sector to serve as a U.S. prosecutor, Clayton served on the board of directors of the private equity giant Apollo Global Management for several years, during which time the company invested billions of dollars in supporting AI and digital infrastructure projects.
More recently, in an interview with CNBC, Clayton stated that he regards AI as a national security issue, but he opposes suspending the development of this technology.
He said, "I don't think any American would consider that a good strategy."
