The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to meet its growing regulatory responsibilities, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under the Trump administration. With about a quarter of the CFTC's staff departing since 2025, the agency is turning to AI and automation to support its oversight of the rapidly expanding cryptocurrency and prediction markets. Selig emphasized that AI tools, such as Microsoft's Copilot, are being integrated into various workflows to enhance surveillance and investigations.
When questioned about the staff reductions, Selig asserted that the agency is operating more efficiently and effectively. The CFTC is being tasked with regulating digital assets and prediction markets, with Chairman Glenn 'GT' Thompson seeking assurance that Selig will request additional support if needed. Selig confirmed that he would do so, while also prioritizing market enforcement.
The agency's budget request for the upcoming year includes a modest increase in enforcement staff, from 105 to 108 people, still short of the 140 personnel it had in 2025. The Digital Asset Market Clarity Act, currently being worked on by the Senate, would position the CFTC as a central authority over non-securities crypto trading, including transactions involving bitcoin and Ethereum. The agency is also claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have seen significant growth.
Selig's predecessor, Rostin Behnam, had argued that the agency required more resources 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 CFTC is conducting numerous investigations into these markets, although Selig declined to provide specifics. He emphasized that regulated platforms are the primary line of defense against illicit activities, while the CFTC serves as a secondary line of defense.
The agency has a 'zero tolerance' policy for market manipulation and insider trading, 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 the rapidly growing and volatile crypto and prediction markets. Craig advocated for providing the CFTC with the necessary staff, funding, and statutory authority to effectively perform its duties. The regulator's personnel declines include the commission itself, which is supposed to have five members but currently consists of only Selig.
He was questioned about proceeding with major rules as a one-person commission, to which he replied that he cannot slow down the rulemaking process 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.
Committee Chairman Thompson announced plans to send a letter to the White House, urging them to fill the vacant commissioner positions with nominees from both parties.