The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to cope with its increasing oversight duties, according to Chairman Mike Selig's congressional testimony, despite a substantial decline in the agency's workforce under the Trump administration. With approximately a quarter of the CFTC's staff departing since 2025 due to federal workforce reduction demands, the agency is leveraging AI tools like Microsoft's Copilot to enhance productivity and support investigations. Selig assured lawmakers that the CFTC is operating more efficiently and effectively, with AI playing a crucial role in surveilling markets and facilitating investigations.
The agency is also prioritizing the regulation of digital assets and prediction markets, with Selig committing to request additional support if needed. The CFTC's enforcement division, however, remains understaffed, with only three new positions requested in the upcoming budget, leaving it about 23% short of its 2025 staffing level. As the Senate continues to work on the Digital Asset Market Clarity Act, which would grant the CFTC central authority over non-securities crypto trading, the agency is asserting its jurisdiction over prediction markets, including those operated by prominent firms like Polymarket and Kalshi.
Selig acknowledged numerous ongoing investigations into prediction markets, emphasizing the CFTC's zero-tolerance policy towards illicit market activity and its commitment to collaborating with regulated platforms to prevent insider trading and market manipulation. Despite these efforts, concerns persist about the agency's staffing and resources, with Representative Angie Craig arguing that the CFTC's workforce is overstretched and requires additional support to effectively regulate the rapidly growing and volatile crypto and prediction markets.