US Crypto Regulatory Body to Leverage AI in Application Review Process

As a leading regulator in the US crypto sector, the Commodity Futures Trading Commission is embracing digital assets and artificial intelligence to compensate for a significant reduction in its workforce. Chairman Mike Selig, set to appear at Consensus 2026, discussed how AI and automation can offset personnel cuts, driven by President Donald Trump's initiative to reduce federal staffing. The agency is advancing the use of technology to review registration applications, enhance market surveillance, and improve overall efficiency. Currently, the CFTC's registration process relies heavily on manual document submission, but Selig emphasized the development of systems to automate this process, making it more efficient and streamlining the review of applications. AI tools can identify incomplete or inaccurate submissions, flagging them for staff review and enabling faster feedback and rejection of non-compliant applications. Selig's team is being trained to utilize Microsoft's Copilot, and the agency is also creating in-house tools for reviewing swap data and conducting market surveillance, demonstrating its commitment to embracing technology. Since taking the helm of the US derivatives regulator, Selig has prioritized oversight of emerging technologies, including crypto and prediction markets. A significant initiative has been the joint guidance with the Securities and Exchange Commission to establish a taxonomy for digital assets, providing clarity on regulatory jurisdictions and enabling market participants to engage with crypto systems with confidence. The agency is also taking action to police fraud, manipulation, and insider trading in crypto markets. Additionally, Selig has been involved in a contentious foray into prediction markets, asserting the CFTC's exclusive jurisdiction over relevant firms and defending this stance in lawsuits against several states. The agency has also joined a Department of Justice case against a US Army soldier accused of insider trading and fraud related to prediction-market bets. Selig emphasized the CFTC's commitment to enforcing regulations and taking action against bad actors in the market, underscoring the seriousness with which the agency approaches these issues.