The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to cope with significant new regulatory responsibilities, according to testimony from Chairman Mike Selig, despite a substantial decline in the agency's workforce under the Trump administration. With about a quarter of the CFTC's staff having left since 2025 due to federal workforce reduction demands, the agency is also tasked with overseeing the rapidly expanding cryptocurrency and prediction markets. Selig emphasized the utility of AI in surveillance and investigations, pointing to the widespread use of Microsoft's Copilot AI tool as a productivity aid. When questioned about staff reductions, Selig asserted that the agency is operating more efficiently and effectively.
The House Agriculture Committee expressed concerns about the agency's capacity to handle its growing responsibilities, particularly in digital assets and prediction markets, with Chairman Glenn 'GT' Thompson seeking assurance that Selig would request additional staff if needed. Selig confirmed that proper market enforcement is a top priority, although the CFTC's budget request for the next year includes only a minor increase in enforcement staff. The Digital Asset Market Clarity Act, currently under consideration in the Senate, would place the CFTC at the forefront of regulating non-securities crypto trading, including transactions in major assets like bitcoin and ether.
The agency is also claiming jurisdiction over prediction markets, which have grown from millions to billions of dollars in a year and have been marred by accusations of insider trading. Selig acknowledged numerous ongoing investigations in prediction markets but declined to provide specifics.
He emphasized the regulated platforms' role in preventing insider trading, fraud, and market manipulation, with the CFTC serving as a secondary line of defense. The committee's top Democrat, Representative Angie Craig, argued that the agency's workforce is overstretched, particularly given its role in regulating two of the fastest-growing and most volatile markets.
Craig advocated for providing the CFTC with the necessary staff, funding, and statutory authority to fulfill its duties. The regulator's personnel declines include the commission itself, which is supposed to have five members but currently consists of only Selig.
The chairman was questioned about proceeding with major rules as a one-person commission and indicated that he would move forward with new regulations, including a preliminary rule process for US prediction markets and policy initiatives in crypto. The committee plans to send a letter to the White House to encourage the prompt filling of commissioner positions with CFTC nominees from both parties.