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Groups tackling AI-generated child sexual abuse material could be given more powers to protect children online under a proposed new law.

Organisations like the Internet Watch Foundation (IWF), as well as AI developers themselves, will be able to test the ability of AI models to create such content without breaking the law.

That would mean they could tackle the problem at the source, rather than having to wait for illegal content to appear before they deal with it, according to Kerry Smith, chief executive of the IWF.

The IWF deals with child abuse images online, removing hundreds of thousands every year.

Ms Smith called the proposed law a “vital step to make sure AI products are safe before they are released”.

An IWF analyst at work. Pic: IWF
Image:
An IWF analyst at work. Pic: IWF

How would the law work?

The changes are due to be tabled today as an amendment to the Crime and Policing Bill.

The government said designated bodies could include AI developers and child protection organisations, and it will bring in a group of experts to ensure testing is carried out “safely and securely”.

The new rules would also mean AI models can be checked to make sure they don’t produce extreme pornography or non-consensual intimate images.

“These new laws will ensure AI systems can be made safe at the source, preventing vulnerabilities that could put children at risk,” said Technology Secretary Liz Kendall.

“By empowering trusted organisations to scrutinise their AI models, we are ensuring child safety is designed into AI systems, not bolted on as an afterthought.”

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AI child abuse image-maker jailed

AI abuse material on the rise

The announcement came as new data was published by the IWF showing reports of AI-generated child sexual abuse material have more than doubled in the past year.

According to the data, the severity of material has intensified over that time.

The most serious category A content – images involving penetrative sexual activity, sexual activity with an animal, or sadism – has risen from 2,621 to 3,086 items, accounting for 56% of all illegal material, compared with 41% last year.

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The data showed girls have been most commonly targeted, accounting for 94% of illegal AI images in 2025.

The NSPCC called for the new laws to go further and make this kind of testing compulsory for AI companies.

“It’s encouraging to see new legislation that pushes the AI industry to take greater responsibility for scrutinising their models and preventing the creation of child sexual abuse material on their platforms,” said Rani Govender, policy manager for child safety online at the charity.

“But to make a real difference for children, this cannot be optional.

“Government must ensure that there is a mandatory duty for AI developers to use this provision so that safeguarding against child sexual abuse is an essential part of product design.”

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Crypto industry, trade unions clash over multi-trillion dollar retirement funds

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Crypto industry, trade unions clash over multi-trillion dollar retirement funds

A growing rift has emerged in Washington, D.C., between the cryptocurrency industry and labor unions as lawmakers debate whether to ease rules allowing cryptocurrencies in 401(k) retirement accounts.

The dispute centers on proposed market structure legislation that would allow retirement accounts to gain exposure to crypto, a move labor groups say could expose workers to speculative risk. In a letter sent on Wednesday to the US Senate Banking Committee, the American Federation of Teachers argued that cryptocurrencies are too volatile for pension and retirement savings, warning that workers could face significant losses.

The letter drew immediate pushback from crypto investors and industry figures. “The American Federation of Teachers has somehow developed the most logically incoherent, least educated take one could possibly author on the matter of crypto market structure regulation,” a crypto investor said on X. 

Retirement, Pensions
The AFT letter to Congress opposes regulatory changes that would allow 401(k) retirement accounts to hold alternative assets, including cryptocurrency. Source: CNBC

In response to the letter, Castle Island Ventures partner Sean Judge said the bill would improve oversight and reduce systemic risk, while enabling pension funds to access an asset class that has delivered strong long-term returns.

Consensys attorney Bill Hughes said the AFT’s opposition to the crypto market structure bill was politically motivated, accusing the group of acting as an extension of Democratic lawmakers.

Retirement, Pensions
Funds held in US retirement accounts by type of account plan. Source: ICI

Related: Atkins says SEC has ‘enough authority’ to drive crypto rules forward in 2026

Opposition to crypto in retirement and pension funds mounts

Proponents of allowing crypto in retirement portfolios, on the other hand, argue that it democratizes finance, while trade unions have voiced strong opposition to relaxing current regulations, claiming that crypto is too risky for traditional retirement plans.

“Unregulated, risky currencies and investments are not where we should put pensions and retirement savings. The wild, wild west is not what we need, whether it’s crypto, AI, or social media,” AFT president Randi Weingarten said on Thursday. 

The AFT represents 1.8 million teachers and educational professionals in the US and is one of the largest teachers’ unions in the country.

According to Better Markets, a nonprofit and nonpartisan advocacy organization, cryptocurrencies are too volatile for traditional retirement portfolios, and their high volatility can create time-horizon mismatches for pension investors seeking a predictable, low-volatility retirement plan.

Retirement, Pensions
Bitcoin and Ether volatility compared to other asset classes and stock indexes. Source: US Federal Reserve

In October, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) also wrote to Congress opposing provisions within the crypto market structure regulatory bill.

The AFL-CIO, the largest federation of trade unions in the US, wrote that cryptocurrencies are volatile and pose a systemic risk to pension funds and the broader financial system.

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