The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to tackle its expanding responsibilities, according to Chairman Mike Selig's congressional testimony, despite a substantial decline in the agency's workforce under President Donald Trump's administration. About a quarter of the CFTC's staff has departed since 2025, due to Trump's demands for federal workforce reductions, as per agency records. However, the CFTC is also tasked with regulating emerging and rapidly growing areas such as cryptocurrency and prediction markets. Selig emphasized that AI tools will be instrumental in surveillance and investigations, citing the widespread use of Microsoft's Copilot AI tool as a productivity aid.
When questioned about staff declines, Selig asserted that the agency is operating more efficiently and effectively. Committee Chairman Glenn 'GT' Thompson noted that the CFTC is being assigned a significant workload with digital assets and prediction markets, seeking assurance that Selig would request assistance if the need for additional qualified staff arises.
Selig affirmed this, stating that proper market enforcement is a top priority. The CFTC's budget request for the next year includes only three additional enforcement staff, leaving the division about 23% short of its 2025 level.
The Digital Asset Market Clarity Act, currently being worked on by the Senate, would grant the CFTC a central role in overseeing non-securities crypto trading, including transactions in leading assets like bitcoin and Ethereum's ether. The agency is also claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have grown from millions to billions of dollars in a year. 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, 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 did not provide specifics. He emphasized that regulated platforms are the first line of defense against insider trading, fraud, and market manipulation, while the CFTC serves as a second line of defense.
Selig stated that his agency has a zero-tolerance policy for illicit market activity and will reject contracts that do not meet regulatory standards. 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 staff, funding, and statutory authority to 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, to which he replied that slowing down rulemaking is not an option.
The CFTC is pursuing a preliminary rule process to establish guardrails for US prediction markets, and Selig has also pushed policy initiatives in crypto. Committee Chairman Thompson announced plans to send a letter to the White House, encouraging them to fill the vacant commissioner positions with CFTC nominees from both parties.