The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to tackle its expanding oversight duties, as stated by Chairman Mike Selig in 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 Trump's demands for significant cuts to the federal workforce, according to agency records.
However, the CFTC is also tasked with regulating the rapidly growing cryptocurrency and prediction markets. Selig noted that AI tools, such as Microsoft's Copilot, will be instrumental in surveillance and investigations, and are being integrated into various workflows.
When questioned about staffing declines, Selig asserted that the agency is operating more efficiently and effectively. The committee chairman, Glenn 'GT' Thompson, expressed concern about the agency's ability to handle its increased responsibilities and sought assurance that Selig would request assistance if needed.
Selig confirmed that proper market enforcement is a top priority, although the CFTC's budget request for the upcoming year only includes three additional enforcement staff members, leaving the division about 23% short of its 2025 staffing level. The Digital Asset Market Clarity Act, currently being worked on by the Senate, would place the CFTC at the forefront of regulating non-securities crypto trading, including transactions involving leading assets like bitcoin and Ethereum. The agency is also asserting its jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced significant growth.
Selig acknowledged numerous ongoing investigations in prediction markets but declined to provide specifics. He emphasized that regulated platforms are the primary line of defense against insider trading, fraud, and market manipulation, while the CFTC serves as a secondary line of defense. Selig stated that the agency has a 'zero tolerance' policy for illicit market activity and will take swift action against those who engage in such behavior. However, 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 effectively perform its duties. The regulator's personnel declines include the commission itself, which is supposed to have five members but currently only has 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, including a preliminary rule process for US prediction markets and policy initiatives in crypto. Thompson announced plans to send a letter to the White House, along with Craig, to encourage the prompt filling of commissioner positions with CFTC nominees from both parties.