Developing an Ethical Framework for Responsible Artificial Intelligence (AI) and Machine Learning (ML) Applications in Cryptocurrency Trading: A Consequentialism Ethics Analysis

Haris Alibašić ()
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Haris Alibašić: Public Administration Program, University of West Florida, 11000 University Pkwy, Pensacola, FL 32514, USA

FinTech, 2023, vol. 2, issue 3, 1-14

Abstract: The rise in artificial intelligence (AI) and machine learning (ML) in cryptocurrency trading has precipitated complex ethical considerations, demanding a thorough exploration of responsible regulatory approaches. This research expands upon this need by employing a consequentialist theoretical framework, emphasizing the outcomes of AI and ML’s deployment within the sector and its effects on stakeholders. Drawing on critical case studies, such as SBF and FTX, and conducting an extensive review of relevant literature, this study explores the ethical implications of AI and ML in the context of cryptocurrency trading. It investigates the necessity for novel regulatory methods that address the unique characteristics of digital assets alongside existing legalities, such as those about fraud and insider trading. The author proposes a typology framework for AI and ML trading by comparing consequentialism to other ethical theories applicable to AI and ML use in cryptocurrency trading. By applying a consequentialist lens, this study underscores the significance of balancing AI and ML’s transformative potential with ethical considerations to ensure market integrity, investor protection, and overall well-being in cryptocurrency trading.

Keywords: artificial intelligence; cryptocurrency trading; consequentialism ethics; regulatory approaches; case studies; market integrity; investor protection (search for similar items in EconPapers)
JEL-codes: C6 F3 G O3 (search for similar items in EconPapers)
Date: 2023
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