The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to tackle its expanding oversight duties, according to Chairman Mike Selig's congressional testimony, as the agency grapples with a significantly reduced workforce under the Trump administration. Approximately a quarter of the CFTC's staff has departed since 2025, amid demands for federal workforce cuts.
However, the agency is also being tasked with regulating the rapidly growing cryptocurrency and prediction markets. Selig noted that AI tools, such as Microsoft's Copilot, will be instrumental in surveilling and investigating these markets, and are being integrated into various workflows.
When questioned about staffing declines, Selig asserted that the agency is operating more efficiently. The House Agriculture Committee Chairman, Glenn 'GT' Thompson, expressed concerns about the agency's ability to handle its growing responsibilities, particularly with regards to digital assets and prediction markets.
Selig assured the committee that he would request assistance if needed. The CFTC is currently pursuing a preliminary rule process to establish guidelines for US prediction markets, and Selig has also introduced policy initiatives in the crypto space. The agency's budget request for the upcoming year includes a request for only three additional enforcement staff, which would still leave the division short of its 2025 staffing levels. The Digital Asset Market Clarity Act, currently being worked on by the Senate, would grant the CFTC a central role in regulating non-securities crypto trading, including transactions involving leading assets such as bitcoin and Ethereum's ether.
The agency is also asserting its jurisdiction over prediction markets, which have been plagued by accusations of insider trading. Selig acknowledged that numerous investigations are ongoing in these markets, but declined to provide further details. 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. The agency has a 'zero tolerance' policy for illicit market activity, and Selig warned that those engaging in such behavior would face the full force of the law.
However, 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 of the fastest-growing and most volatile markets. Craig emphasized the need for the CFTC to receive adequate staffing, funding, and statutory authority to effectively perform its duties. 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.
The committee plans to send a letter to the White House, urging them to fill the vacant commissioner positions with nominees from both parties.