US Regulator CFTC to Utilize AI in Reviewing Crypto Registration Applications

The US Commodity Futures Trading Commission, known for its support of digital assets, is now embracing artificial intelligence to compensate for a significant reduction in its workforce, according to Chairman Mike Selig in an interview with CoinDesk. Selig, who is scheduled to appear at Consensus 2026, explained that AI and automation will help offset personnel cuts resulting from President Donald Trump's efforts to reduce federal staffing. The agency, which is poised to become a leading US regulator for the crypto sector, is working towards utilizing technology to review registration applications and aid in market surveillance. Currently, the CFTC's registration process relies on manual document submission, but Selig stated that the agency is developing systems to automate this process, making it more efficient. AI tools can review applications, flag issues for staff, and make their jobs easier and faster, allowing them to provide feedback and reject incomplete applications. Selig's staff is being trained to use Microsoft's Copilot, and the agency is also building in-house tools for reviewing swap data and market surveillance. The chairman has been at the helm of the US derivatives regulator for four months and has taken a proactive approach to emerging technologies, including crypto and prediction markets. One of Selig's major initiatives has been to establish oversight of the crypto industry, and he believes that the joint guidance with the Securities and Exchange Commission to create a taxonomy for digital assets is a significant development. This taxonomy will provide clarity for market participants, software developers, and consumers, allowing them to engage with crypto systems and assets with confidence. Selig also discussed the agency's stance on prediction markets, which has been contentious, particularly with states challenging companies for violating state gaming laws. The CFTC has taken action against bad actors in the market and will continue to monitor and enforce regulations in the crypto and prediction markets sectors.