The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to tackle its expanded oversight responsibilities, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under President Donald Trump's administration. Approximately a quarter of the CFTC's staff has departed since 2025, due to Trump's demands for a reduced federal workforce, as per agency records. However, the CFTC is also tasked with regulating the rapidly growing cryptocurrency and prediction markets.
Selig stated that 'tools like AI will be instrumental in surveillance and investigations, and we are integrating them into our workflows,' citing the widespread use of Microsoft's Copilot AI tool as a productivity aid. When questioned about the staff reductions, Selig asserted that the agency is 'operating more efficiently and effectively.' Committee Chairman Glenn 'GT' Thompson noted that the CFTC is being assigned a substantial workload with digital assets and prediction markets, and he sought assurance from Selig that he would request help from the panel if the need for additional qualified staff arises. Selig confirmed that he would do so. He emphasized that proper market enforcement is a top priority, although the CFTC's budget request for the upcoming year only asks for three additional enforcement staff, bringing the total to 108 people, which is still 23% short of the 140 staff members 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'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, former Chairman 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 markets have drawn scrutiny over certain trades related to US military actions and government statements, suggesting potential insider trading by individuals with government insight. Selig acknowledged 'numerous ongoing investigations' in prediction markets but declined to provide specifics.
He stated 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. 'We regularly reject contracts,' Selig said, adding that his agency has a 'zero tolerance' policy for illicit market activity. Representative Angie Craig, the committee's top Democrat, argued that the agency's workforce is 'stretched too thin,' particularly considering its role as the primary regulator of two of the fastest-growing and most volatile markets. 'We must provide the CFTC with the necessary staff, funding, and statutory authority to perform its duties,' Craig said.
The personnel declines at the regulator include the commission itself, which is supposed to have five members but has been left with only Selig by the White House. Selig was questioned about proceeding with major rules as a one-person commission and stated that 'we cannot slow down our rulemaking for the sake of the American people.' The CFTC is pursuing a preliminary rule process to establish guardrails for US prediction markets, and Selig has also promoted policy initiatives in crypto.
Thompson announced that he and Craig will send a letter to the White House to 'encourage them to promptly fill the commissioner positions' with CFTC nominees from both parties.