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, as stated by Chairman Mike Selig in an interview. Selig, who is scheduled to speak at Consensus 2026, noted that AI and automation will help offset the 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 to utilize technology to review registration applications and assist in market surveillance. Currently, the CFTC's registration process relies on manual document submission, but the agency is building systems to automate this process, making it more efficient. AI tools can review applications, flag issues for staff, and reject incomplete or inaccurate submissions. 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. The chairman has been at the helm of the US derivatives regulator for four months and has made significant strides in overseeing emerging technologies, including crypto and prediction markets. A key 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 agency is committed to policing fraud, manipulation, and insider trading in crypto markets. Additionally, the CFTC has been involved in contentious issues surrounding prediction markets, with Selig taking a firm stance that the agency has exclusive jurisdiction over these firms. The CFTC has sued several states and is taking enforcement action against bad actors in the markets, demonstrating its commitment to regulating the crypto and prediction markets sectors.