The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to tackle its expanded oversight responsibilities, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under the Trump administration. About 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 regulating 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 staff reductions, 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 expanded responsibilities, particularly with regards to digital assets and prediction markets.
Selig assured him that if additional qualified staff are needed, he will request assistance from the panel. The CFTC is currently pursuing a preliminary rule process to establish guidelines for US prediction markets, and Selig has also initiated policy initiatives in the crypto space. The agency's budget request for the upcoming year includes a request for only three additional enforcement staff, which would still leave the division 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 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 in recent years. Selig's predecessor, former Chairman Rostin Behnam, had consistently argued that the agency required more personnel to effectively oversee crypto and prediction markets. During Selig's tenure, the prediction markets have been marred by accusations of insider trading, with some cases being addressed by the firms themselves.
The chairman acknowledged that numerous investigations are ongoing, although he declined to provide further details. He emphasized that regulated platforms serve as the first line of defense against insider trading, fraud, and market manipulation, while the CFTC acts as a second line of defense. Selig stated that his agency has a 'zero tolerance' policy for illicit market activity and will take swift action against those who engage in such behavior. Representative Angie Craig, the committee's top Democrat, 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 White House has been criticized for leaving the commission with only one member, Selig, despite the law requiring five members, including two from the minority party.
Selig was questioned about his plans to proceed with major rules as a one-person commission, and he indicated that he will move forward with new regulations, stating that slowing down the rulemaking process would be detrimental to the American people. The committee plans to send a letter to the White House, urging them to promptly fill the vacant commissioner positions with nominees from both parties.