The US Commodity Futures Trading Commission is embracing artificial intelligence to navigate significant new responsibilities, according to Chairman Mike Selig's congressional testimony, despite a substantial decline in the agency's workforce under President Donald Trump's administration. Approximately a quarter of the CFTC's staff has departed since 2025, owing to Trump's demands for a reduced federal workforce. However, the CFTC is tasked with regulating emerging and rapidly expanding areas, including cryptocurrency and prediction markets. Selig emphasized that AI tools will be instrumental in surveillance and investigations, citing the widespread adoption of Microsoft's Copilot AI as a key productivity aid.
When questioned about staff reductions, Selig asserted that the agency is operating more efficiently. Committee Chairman Glenn 'GT' Thompson expressed concern about the agency's capacity to handle its growing workload, particularly with regard to digital assets and prediction markets.
Selig assured him that if additional qualified staff are needed, he will request assistance from the panel. The CFTC chief confirmed that effective market enforcement is a top priority, although the agency's budget request for the upcoming year includes only a modest increase in enforcement staff.
The proposed Digital Asset Market Clarity Act would grant the CFTC a central role in overseeing non-securities crypto trading, encompassing transactions in 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, former Chairman 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 cases 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 defense against illicit activities, while the CFTC acts as a secondary line of defense.
Selig noted that the agency regularly rejects contracts and is actively reviewing market activity, adhering to a 'zero tolerance' policy for illicit behavior. Representative Angie Craig, the committee's top Democrat, argued that the agency's workforce is overstretched, particularly given its role as the primary regulator of two rapidly growing and volatile markets. Craig advocated for providing the CFTC with sufficient staff, funding, and statutory authority to fulfill its responsibilities. The regulator's personnel decline includes the commission itself, which is supposed to have five members but currently consists of only Chairman 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. The CFTC is pursuing a preliminary rule process to establish guardrails 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 promptly fill the vacant commissioner positions with nominees from both parties.