US Crypto Regulatory Body to Leverage AI for Application Reviews

The US Commodity Futures Trading Commission, known for its openness to digital assets, is now embracing artificial intelligence to compensate for the reduction in its workforce, according to Chairman Mike Selig. In an interview, Selig mentioned that the agency is moving towards utilizing AI and automation to review registration applications and assist in market surveillance, given the current manual document submission process. The goal is to build systems that automate this process, making it more efficient. AI tools can review applications, flag issues for staff, and reject incomplete or incorrect submissions, thereby streamlining the process and providing faster feedback. Selig's team is being trained on Microsoft's Copilot, and the agency is also developing in-house tools for reviewing swap data and market surveillance. This move is part of the CFTC's broader initiative to oversee emerging technologies, including crypto and prediction markets. A key development has been the joint guidance with the Securities and Exchange Commission to create a taxonomy for digital assets, providing clarity on regulatory jurisdictions. The CFTC is also taking action against fraud and manipulation in crypto markets and is involved in contentious issues regarding prediction markets, asserting its exclusive jurisdiction over these firms.