Larry Ward: California's AI Regulations Have "No Heat," Won't Address Real Concerns

Market Rithm President Larry Ward breaks down California's new AI law regulating frontier platforms and explains why it falls short of addressing real threats like election deepfakes.

Ward highlights major loopholes in the legislation: the law only applies to platforms with over 1 million users, meaning individuals can download tools like DeepSeeker or Meta AI locally and create unregulated deepfake content. Even when watermarks exist, they're easily removable before distribution.

"There really is no heat to this law," Ward warns, noting that only AI producers—not distributors—face accountability. With the 2026 elections approaching, last-minute deepfakes could prove "really consequential" without effective enforcement mechanisms.

Ward explains that while he agrees in spirit with transparency measures like watermarks and data source disclosure, the reality is the law has critical gaps. The million-user threshold creates a massive enforcement loophole, watermarks are easily removed by bad actors, and the law targets producers rather than distributors of deepfakes. With local AI tools bypassing regulations entirely, there are serious timing concerns ahead of the 2026 elections.

#AIRegulation #California #Deepfakes #Election2026 #TechPolicy