The contribution of AI-generated content could trigger Maria Gramsch in the first place on Basic Thinking. You always stay up to date with our newsletter.
Banking towers in which numerous people withdraw or withdraw their money can have fatal consequences for credit institutions. A new study shows that AI-generated content can increase the risk of such a banking crisis.
So-called bank runs are not uncommon in the financial industry. If investors feel that their geriatric reserves are no longer safe at their bank, they usually react very quickly and take off their financial means.
Such banking towers can become a problem for the banks themselves. Because if many customers want to withdraw their deposits at the same time, the liquid means of the banks usually reach their limits.
This is mainly due to the business model of the credit institutions, in which capital invested at short notice is awarded in the long term. There is therefore not enough money in the case of a bank run to pay out their complete deposits for all savers.
In addition to the actual problems of individual banks, banking towers can also be triggered by rumors or false information. Like one Study from Great Britain shows that AI generated content enormously increase the risk.
AI generated content can lead to banking crisis
For their study, the British research company Say No To Disinfo and the communications company Fenimore Harper simulated a AI-supported disinformation campaign. The aim was to determine how such a campaign could trigger a bank run.
The researchers have created a doppelganger website for their campaign. Based on existing websites, they created domains such as “foxnews.cx” or “Washingtonpost.pm” to spread AI-generated fake news. The study authors then shared these via X (formerly Twitter).
Memes were also used for the fake news campaign. These were shared by Instagram, Facebook and X and showed pictures that implied uncertainties at certain banks.
“Since AI disinformation campaigns make it easier, cheaper, faster and more effective than ever, the risk for the financial sector grows quickly,” says the report. This is particularly problematic because inserters can move their money through online and mobile banking in a matter of seconds.
Reactions to fake news campaign
In order to evaluate the effect of the disinformation campaign, the researchers have confronted a group of 500 people with the content. Around 60 percent of those surveyed stated that they would withdraw or move their money. 33.6 percent estimated this as very likely, 27.2 percent still as more likely.
The continuation rate of the AI-generated content is also remarkable. 60 percent of those surveyed stated that this information was shared with one to three people. 20 percent would even have shared the content with more than three people.
In the study results, the authors estimate that up to one million pounds of customer deposits could be moved for every 10 pound that are spent on social media advertising. The estimates are based on the average deposits of the British bank customers and the costs for social media advertising.
Due to these risks by AI generated content, credit institutions would also have to monitor social networks in order to avoid banking panic, the study authors warn. By monitoring mention on the platforms in connection with withdrawals, the banks could determine when fake news influence customer behavior.
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The contribution of AI-generated content could trigger Maria Gramsch in the first place on Basic Thinking. Follow us too Google News and Flipboard.
As a tech industry expert, I believe that AI-generated content has the potential to trigger a banking crisis if not properly regulated and monitored. The use of artificial intelligence in creating content, such as fake news or fraudulent financial reports, could mislead investors and depositors, leading to a loss of trust in the banking system.
AI-generated content can also be used to manipulate stock prices or spread misinformation about a bank’s financial health, which could have serious consequences for the stability of the financial sector. It is crucial for regulators and financial institutions to stay ahead of these developments and implement safeguards to prevent the misuse of AI in creating deceptive content.
Furthermore, the use of AI in banking and finance should be accompanied by strict guidelines and oversight to ensure transparency and accountability. By taking proactive measures to address the potential risks associated with AI-generated content, we can help prevent a banking crisis and maintain the integrity of the financial system.
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