David Sacks: The AI Regulatory Frenzy at the State Level is “Very Concerning”

Regulatory Landscape - All 50 states have introduced AI bills in 2025, with over 1,000 bills in state legislatures [1] - 118 AI laws have already been passed across the 50 states [1] - There is a lack of agreement on the purpose and goals of these AI regulations [2] - 50 different states each with their own reporting regime, which is going to be a trap for startups [3] Algorithmic Discrimination & Compliance - Colorado's SB24-205 bans algorithmic discrimination, defined as unlawful differential treatment or disparate impact based on protected characteristics [4] - Protected characteristics include age, race, sex, and disability; disparate impact based on these factors can lead to prosecution for both AI model developers and deployers [5] - Even race-neutral criteria leading to disparate impact can be deemed discriminatory [6] - Model developers may need to build in a DEI layer to prevent outputs with disparate impact [6]