The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to address its substantial new regulatory responsibilities, as outlined by Chairman Mike Selig in his congressional testimony. Despite a significant decline in the agency's workforce under the Trump administration, with approximately a quarter of staff leaving since 2025, the CFTC is leveraging tools like AI to enhance its surveillance and investigative capabilities. Selig emphasized that the agency is 'running more efficiently and effectively' and that AI tools, such as Microsoft's Copilot, are being integrated into various workflows to support productivity.
The CFTC is facing increased demands to regulate the rapidly growing crypto and prediction markets, with Chairman Selig acknowledging 'numerous investigations ongoing' in these areas. The agency's budget request for the upcoming year includes a modest increase in enforcement staff, from 105 to 108 people, which still falls short of the 140 personnel the division had in 2025. 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 involving prominent assets like bitcoin and ether. The agency is also asserting its jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced significant growth in recent times.
Selig's predecessor, former Chairman Rostin Behnam, had consistently argued that the agency required more resources to effectively oversee the crypto market. During Selig's tenure, the prediction markets have faced accusations of insider trading, prompting the CFTC to launch investigations. The chairman emphasized the importance of regulated platforms serving as the first line of defense against illicit activities, while the CFTC acts as a second line of defense.
He reiterated the agency's 'zero tolerance' policy for market manipulation and insider trading, stating that anyone engaging in such behavior would face the full force of the law. However, Representative Angie Craig, the committee's top Democrat, expressed concerns that the agency's workforce is overstretched, particularly given its role as the primary regulator of two of the fastest-growing and most volatile markets.
Craig argued that the CFTC requires additional staff, funding, and statutory authority to effectively perform its duties. The personnel decline at the regulator includes 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 and responded that he would not slow down the rulemaking process. The CFTC is pursuing a preliminary rule process to establish guardrails for US prediction markets, and Selig has also promoted policy initiatives in the crypto space.
Committee Chairman Glenn 'GT' Thompson announced plans to send a letter to the White House, urging them to fill the vacant commissioner positions with nominees from both parties.