The libertarian Cato Institute is warning that a government-mandated pause in artificial intelligence development could shield dominant companies from competition and delay beneficial technology, as lawmakers and AI executives push for restraints.

In a blog post on Monday, Jennifer Huddleston, a technology policy scholar at the think tank, argued that companies can address specific dangers through voluntary safeguards and shared standards without halting development across the industry.

“A government-mandated pause would raise several concerns, and likely fail to fulfill its alleged safety improvements,” she wrote, adding that government rules are slow to write and slower to change. “A regulatory framework built for today’s models may actively hinder tomorrow’s, preventing what could be better or safer responses.”

Huddleston acknowledges AI’s risks but warns that rules shaped around leading developers could help them consolidate power and limit competition—a form of market capture that would make it harder for smaller companies to compete. She also argues that pausing U.S. development could weaken cybersecurity defenses while foreign rivals continue advancing.

Her commentary follows a proposal from Sen. Bernie Sanders and Rep. Greg Casar to pause advanced AI development until federal safety standards are established and permanently ban artificial superintelligence, while OpenAI CEO Sam Altman has backed slower development and urged companies to strengthen safeguards without waiting for federal rules he supports.

“Many of these calls are accompanied by science fiction-esque doomsday scenarios about the worst that could happen,” Huddleston wrote. “Yet a rush to regulate out of fear could have longer-term negative consequences than the risk it claims to address.”

Block’s chairman and co-founder, Jack Dorsey, voiced similar concerns about competition in a post on X on Monday.

“The companies leading machine intelligence deserve to be heard. They have expertise and commercial interests to protect,” Dorsey wrote. “Rules built around their resources could make them the only ones able to participate. A sincere concern about safety can still produce a barrier to entry.”

Dorsey said he favors open releases that researchers can inspect, modify, and test, with evaluations and known limitations published so outsiders can challenge developers’ safety claims.

“I support scrutiny. I oppose industry-wide limits negotiated by today’s leaders because they could exclude the people who might expose failures or build alternatives,” he wrote. “Preserving a company’s commercial advantage is not a safety objective.”

In his post, Dorsey also said he supports independent testing and publicly accountable enforcement, including withholding models when evidence shows their release would materially increase catastrophic risks that narrower measures cannot adequately address.

“Compute can trigger scrutiny without capping development. Examination is not permission from a regulator or competitor,” he said. “I don’t want general approval requirements or waiting periods. Any imposed safety-based delay to publication has to be justified by the catastrophic-risk exception.”

A recent Atlantic Council analysis argues that competitive pressure demands enforceable AI safety standards, while U.S.–China distrust complicates international agreements. Cooperation also raises antitrust concerns: OpenAI has asked lawmakers whether rival developers could legally agree to slow development.