The US Commodity Futures Trading Commission is leveraging artificial intelligence and automation to tackle its growing regulatory responsibilities, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under President Donald Trump's administration. Approximately a quarter of the CFTC's staff has departed since 2025, due to Trump's demands for federal workforce reductions. However, the CFTC is also tasked with regulating the rapidly expanding cryptocurrency and prediction markets.
Selig emphasized that AI tools will play a crucial role in surveillance and investigations, citing the widespread use of Microsoft's Copilot AI tool as a productivity aid. When questioned about staff declines, Selig asserted that the agency is operating more efficiently and effectively.
The House Agriculture Committee Chairman, Glenn 'GT' Thompson, expressed concern about the agency's capacity to handle its expanded responsibilities, particularly with regard to digital assets and prediction markets. Selig assured the committee that he would request assistance if needed.
The CFTC is prioritizing enforcement, with Selig stating that it is a 'top priority,' although the agency's budget request for the upcoming year only includes three additional enforcement staff members. 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 claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced rapid growth. 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 further details. 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 decisive action against those who engage in such behavior.
However, Representative Angie Craig, the committee's top Democrat, expressed concerns that the agency's workforce is overstretched, particularly given its role as the primary regulator of two rapidly growing and volatile markets. Craig advocated for providing the CFTC with the necessary staff, funding, and statutory authority to perform its duties effectively. 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. 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 will be sending a letter to the White House to encourage the prompt filling of commissioner positions with CFTC nominees from both parties.