AI Overconfidence Risk in Trading — A Cautionary Moment
A viral anecdote about a senior FX desk head developing 'terminal AI psychosis' after over-relying on an AI assistant underscores growing concerns about AI misuse in professional trading.
What we know
An account on X shared a cautionary story about a seasoned FX vol trader becoming convinced — after spending 8 hours/day with an AI assistant — that he'd found a 'generational arb' in an exotic part of the vol curve. Van Rossum warns this will happen far more to less experienced traders. He separately noted that retail traders across all major platforms (not just Hyperliquid) systematically lose, with over half of losses going to fees — reinforcing the dangers of under-informed participation.
By the Global Eye 24 desk, with AI assistance. Updated as the story develops. Spot an error? Write to corrections@globaleye24.com.