The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to tackle its expanding oversight duties, according to Chairman Mike Selig's testimony to Congress, despite a substantial decline in the agency's workforce under the Trump administration. Since 2025, about a quarter of the CFTC's staff has departed, owing to President Trump's push for significant cuts to the federal workforce. Nevertheless, the CFTC is being tasked with regulating the rapidly evolving cryptocurrency and prediction markets. Selig emphasized that AI tools, such as Microsoft's Copilot AI, are being integrated into various workflows to enhance surveillance and investigations.
When questioned about the staffing decline, Selig asserted that the agency is operating more efficiently and effectively. Committee Chairman Glenn 'GT' Thompson expressed concern about the workload and staffing, seeking assurance that Selig would request assistance if needed. Selig confirmed that he would do so, emphasizing that proper market enforcement is a top priority.
The CFTC's budget request for the upcoming year includes only three additional enforcement staff, which would still leave the division about 23% short of its 2025 level. The Digital Asset Market Clarity Act, currently being worked on by the Senate, would position the CFTC as a central authority over non-securities crypto trading, encompassing transactions in prominent assets like bitcoin and Ethereum.
The agency is also claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced exponential growth. Selig's predecessor, Rostin Behnam, had consistently argued that the agency required more personnel to effectively oversee crypto and prediction markets. During Selig's tenure, the prediction markets have faced accusations of insider trading, with some instances being addressed by the firms themselves.
The chairman acknowledged numerous ongoing investigations in prediction markets but declined to provide specifics. He emphasized that regulated platforms serve as the primary line of defense against illicit activities, while the CFTC acts as a secondary line of defense. Selig noted that his agency has a zero-tolerance policy for market manipulation and insider trading, and that those engaging in such behavior will face the full force of the law.
Representative Angie Craig argued that the agency's workforce is overstretched, particularly given its role as the primary regulator of two rapidly growing and volatile markets. Craig emphasized the need for the CFTC to receive adequate staffing, funding, and statutory authority to perform its duties effectively.
The White House has left the commission with a solitary member, Selig, despite the law requiring a five-member commission, including two minority party commissioners. Selig was questioned about proceeding with major rules as a one-person commission and indicated that he would move forward with new regulations, citing the need to protect the American people.
The CFTC is currently pursuing a preliminary rule process to establish guidelines for US prediction markets, and Selig has also promoted policy initiatives in crypto. Committee Chairman Thompson announced plans to send a letter to the White House, urging them to fill the vacant commissioner positions with nominees from both parties.