The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to cope with significant new regulatory responsibilities, according to testimony by Chairman Mike Selig, despite a substantial decline in the agency's workforce under the Trump administration. With about a quarter of the CFTC's staff having departed since 2025, the agency is also tasked with overseeing the rapidly growing cryptocurrency and prediction markets. Selig noted that AI tools, such as Microsoft's Copilot, are being utilized to enhance productivity and support investigations. When questioned about the staffing reductions, Selig asserted that the agency is operating more efficiently and effectively.
The CFTC is being called upon to regulate digital assets and prediction markets, with Chairman Glenn 'GT' Thompson seeking assurance that Selig will request additional support if needed. Selig confirmed that proper 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 Digital Asset Market Clarity Act, currently being considered by the Senate, would grant the CFTC a central role in overseeing non-securities crypto trading, including transactions involving prominent assets like bitcoin and Ethereum.
The agency is also claiming jurisdiction over prediction markets, which have experienced rapid growth and drawn scrutiny over potential insider trading. Selig acknowledged numerous ongoing investigations in prediction markets but declined to provide further details.
He emphasized the importance of regulated platforms in preventing 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, with Selig warning that those engaging in such behavior will face the full force of the law. However, Representative Angie Craig expressed concerns that the agency's workforce is overstretched, particularly given its role as the primary regulator of two rapidly growing and volatile markets. Craig argued that the CFTC requires additional staff, funding, and statutory authority to effectively perform its duties.
The commission itself is currently understaffed, with only Selig serving as a solitary member, and the White House has been urged to promptly fill the vacant positions. Selig indicated that he will proceed with new regulations, including a preliminary rule process for US prediction markets, and has also initiated policy initiatives in crypto. Committee Chairman Thompson and Representative Craig plan to send a letter to the White House, encouraging the prompt appointment of CFTC nominees from both parties to fill the commission vacancies.