The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to cope with substantial new regulatory responsibilities, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under the Trump administration. Approximately a quarter of the CFTC's staff has departed since 2025, due to President Trump's demands for a reduced federal workforce, as per agency records.
However, the CFTC is also tasked with regulating the rapidly expanding cryptocurrency and prediction markets. Selig emphasized that AI tools will be instrumental in surveillance and investigations, and are being integrated into various workflows.
When questioned about the staff reductions, Selig asserted that the agency is operating more efficiently and effectively. The House Agriculture Committee Chairman, Glenn 'GT' Thompson, expressed concerns about the agency's capacity to handle its expanded responsibilities, particularly in digital assets and prediction markets. Selig assured the committee that he would request assistance if the need for additional qualified staff arises. He also stated that enforcing market regulations is a top priority, although the CFTC's budget request for the upcoming year only includes three additional enforcement staff members, which would still be about 23% short of the 140 personnel the division had in 2025.
The Digital Asset Market Clarity Act, currently being worked on by the Senate, would place the CFTC at the forefront of regulating non-securities crypto trading, including transactions involving prominent assets like bitcoin and Ethereum. The agency is also asserting its jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced significant growth.
Selig's predecessor, Rostin Behnam, had argued that the agency required more personnel to oversee crypto and lacked the resources to police the expanding prediction markets. During Selig's tenure, the prediction markets have faced accusations of insider trading, with some cases being addressed by the firms themselves.
The chairman acknowledged numerous ongoing investigations in the prediction markets but declined to provide specifics. He emphasized that regulated platforms are the primary line of defense against insider trading, fraud, and market manipulation, while the CFTC serves as a secondary line of defense. Selig noted that his agency regularly rejects contracts and is actively reviewing the markets, with a 'zero tolerance' policy for illicit activities. Representative Angie Craig, the committee's top Democrat, argued that the agency's workforce is overextended, 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 personnel declines at the regulator include the commission itself, which is supposed to have five members but has been left with 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.
Thompson stated that he and Craig would be sending a letter to the White House, encouraging them to promptly fill the vacant commissioner positions with CFTC nominees from both parties.