The U.S. Commodity Futures Trading Commission is leveraging artificial intelligence and automation to tackle its expanding responsibilities, according to Chairman Mike Selig's congressional testimony. Despite a significant decline in the agency's workforce under the Trump administration, the CFTC is being tasked with regulating the rapidly growing cryptocurrency and prediction markets. Approximately a quarter of the CFTC's staff has departed since 2025, due to President Trump's demands for federal workforce reductions.
However, the agency is also being called upon to oversee new and rapidly expanding areas, including cryptocurrency and prediction markets. Selig emphasized that AI tools will be instrumental in surveillance and investigations, citing the widespread use of Microsoft's Copilot AI tool as a key productivity aid.
When questioned about staff declines, Selig asserted that the agency is operating more efficiently and effectively. Committee Chairman Glenn 'GT' Thompson expressed concerns about the agency's capacity to handle its growing workload, particularly with regards to digital assets and prediction markets. Selig assured the committee that he would request assistance if needed.
The CFTC chief stated that proper market enforcement is a top priority, although the agency's budget request for the upcoming year only includes three additional enforcement staff, leaving the division about 23% short of its 2025 staffing levels. 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 leading assets like bitcoin and Ethereum. The agency is also claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced significant growth.
Selig's predecessor, former Chairman Rostin Behnam, had argued that the agency required more personnel to effectively oversee crypto and 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 chairman acknowledged numerous ongoing investigations in prediction markets but declined to provide further details. He emphasized that regulated platforms are the first line of defense against illicit activities, while the CFTC serves as a second line of defense. Selig noted that the agency regularly rejects contracts and is actively reviewing market activity, with a 'zero tolerance' policy for illicit behavior.
Representative Angie Craig argued that the agency's workforce is overstretched, particularly given its role as the primary regulator of two rapidly growing and volatile markets. Craig emphasized the need for the CFTC to receive adequate staffing, funding, and statutory authority to perform its duties effectively. The regulator's personnel declines include 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 indicated that he would move forward with new regulations. The CFTC is pursuing a preliminary rule process to establish guardrails for U.S.
prediction markets, and Selig has also promoted policy initiatives in crypto. Committee Chairman Thompson announced plans to send a letter to the White House, encouraging them to fill the vacant commissioner positions with nominees from both parties.