The US Commodity Futures Trading Commission (CFTC) is embracing artificial intelligence (AI) and automation to cope with significant new regulatory responsibilities, according to Chairman Mike Selig's congressional testimony, despite a substantial decline in the agency's workforce under the Trump administration. Approximately a quarter of the CFTC's staff has departed since 2025, due to President Trump's demands for federal workforce reductions. However, the CFTC 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 staffing declines, Selig asserted that the agency is operating more efficiently. The House Agriculture Committee Chairman, Glenn 'GT' Thompson, expressed concerns about the agency's capacity to handle its expanded role in digital assets and prediction markets, seeking assurance that Selig would request additional support if needed. Selig confirmed that proper market enforcement is a top priority, although the CFTC's budget request for the upcoming year includes only three additional enforcement staff members.
The Digital Asset Market Clarity Act, currently being considered by the Senate, would grant the CFTC a central role in regulating non-securities crypto trading, including transactions involving leading assets like bitcoin and Ethereum. The agency is also claiming jurisdiction over prediction markets, which have grown from millions to billions of dollars in a short period. Selig's predecessor, 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 investigations ongoing' in prediction markets but declined to provide specifics. He emphasized that regulated platforms serve as the first line of defense against illicit activities, while the CFTC acts as a second line of defense.
Selig stated that his agency has a 'zero tolerance' policy for market manipulation and insider trading. However, Representative Angie Craig, the committee's top Democrat, argued that the agency's workforce is overextended, 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 fulfill its responsibilities. The regulator's personnel declines include the commission itself, which is supposed to have five members but currently consists of 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 US prediction markets, and Selig has also promoted policy initiatives in crypto.
Thompson announced that he and Craig would be sending a letter to the White House to encourage the prompt filling of commissioner positions with CFTC nominees from both parties.