US Regulator to Leverage AI for Crypto Registration Reviews

The US Commodity Futures Trading Commission, known for its openness to digital assets, is now turning to artificial intelligence to compensate for a significant reduction in its workforce. Chairman Mike Selig revealed this in an interview, highlighting the regulator's push to utilize AI in reviewing registration applications and aiding in market surveillance. Currently, the CFTC's registration process involves manual document submission, but the agency is working on automating this process to increase efficiency. AI tools will be used to review applications, flag issues, and make the feedback process faster for staff. The agency is also developing in-house tools for reviewing swap data and market surveillance, embracing technology to reach conclusions about trades. Selig emphasized the importance of oversight in the crypto industry, particularly in the absence of new legislation. 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. The CFTC is also taking action against fraud and manipulation in crypto markets. Furthermore, the regulator has been involved in contentious issues regarding prediction markets, with Selig asserting the CFTC's exclusive jurisdiction over these firms. The agency has sued several states and is taking enforcement action against bad actors in the markets, demonstrating its commitment to oversight and regulation.