The US Commodity Futures Trading Commission is embracing 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, with approximately a quarter of staff leaving since 2025, the CFTC is adapting to its new role in overseeing the rapidly growing cryptocurrency and prediction markets. Selig emphasized the importance of AI in surveillance and investigations, stating that 'tools such as AI are going to be very helpful in surveilling and bringing the investigations.' The agency is leveraging AI tools, including Microsoft's Copilot, to streamline workflows and improve efficiency.
When questioned about the staff reductions, Selig asserted that the agency is 'running more efficiently and effectively.' Committee Chairman Glenn 'GT' Thompson expressed concerns about the agency's capacity to handle its increased workload, particularly with regards to digital assets and prediction markets. Selig assured the committee that he would request assistance if needed, stating 'absolutely.' The CFTC is currently pursuing a preliminary rule process to establish guardrails for US prediction markets, and Selig has also initiated policy initiatives in the crypto space. The agency's enforcement division, however, remains understaffed, with only 108 personnel, which is approximately 23% shy of the 140 staff members it had in 2025. 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 prominent 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 rapid growth from millions to billions of dollars. 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 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 further details. He emphasized the importance of regulated platforms as the first line of defense against illicit activities and the CFTC's role as a second line of defense. The agency has a 'zero tolerance' policy for market manipulation and insider trading, with Selig stating that 'anyone who engages in that behavior will face the full force of the law.' 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 to provide the CFTC with 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, Chairman Selig, despite the law requiring five members, including two from the minority party. Selig was questioned about proceeding with major rules as a one-person commission and stated that he would move forward with new regulations, saying 'we cannot for the sake of the American people slow down our rulemaking.'