The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to tackle its growing responsibilities in overseeing cryptocurrency and prediction markets, according to Chairman Mike Selig's testimony to Congress. Despite a substantial decline in the agency's workforce under the Trump administration, with about a quarter of staff leaving since 2025, the CFTC is leveraging AI tools like Microsoft's Copilot to enhance its surveillance and investigative capabilities. Selig emphasized that the agency is operating more efficiently and effectively, with AI playing a crucial role in its workflows.
The CFTC is also asserting its jurisdiction over prediction markets, such as Polymarket and Kalshi, which have seen significant growth. Selig acknowledged numerous ongoing investigations in these markets but did not provide further details.
The agency's budget request for the next year includes only a modest increase in enforcement staff, which has raised concerns among lawmakers about the CFTC's ability to effectively regulate these rapidly expanding markets. The Senate's Digital Asset Market Clarity Act would further elevate the CFTC's role in overseeing non-securities crypto trading, while the agency is also claiming a dominant jurisdiction over prediction markets. Selig's predecessor had argued that the agency needed more resources to effectively police these markets, and lawmakers are now urging the White House to fill vacant commissioner positions to ensure the CFTC has the necessary capacity to fulfill its responsibilities.