US Crypto Regulatory Body to Utilize AI for Application Reviews

The US Commodity Futures Trading Commission, known for its forward-thinking approach to digital assets, is now embracing artificial intelligence to offset the impact of significant workforce reductions. Chairman Mike Selig revealed in an interview that the agency is developing AI-powered tools to review registration applications, monitor trading data, and aid in market surveillance, thereby streamlining processes and improving efficiency. The CFTC is transitioning from manual document submission to automated systems, enabling AI to flag incomplete or inaccurate applications for staff review. Additionally, the agency is utilizing Microsoft's Copilot and in-house tools to analyze swap data and detect potential market manipulation. Under Selig's leadership, the CFTC has made significant strides in overseeing emerging technologies, including crypto and prediction markets. A notable initiative is the joint guidance with the Securities and Exchange Commission, establishing a taxonomy for digital assets to provide clarity on regulatory jurisdictions. The CFTC is also actively policing fraud and manipulation in crypto markets, with a strong stance on its exclusive jurisdiction over prediction markets, which has led to conflicts with states and legal actions against non-compliant firms.