US Regulator to Utilize AI for Crypto Registration Applications

The US Commodity Futures Trading Commission, known for its openness to digital assets, is turning to artificial intelligence to compensate for a significant reduction in its workforce. Chairman Mike Selig revealed in an interview that the agency is leveraging AI and automation to make up for personnel cuts, as part of President Donald Trump's initiative to reduce federal staffing. Selig, who is scheduled to speak at Consensus 2026 in Miami, stated that the regulator is working towards utilizing AI to review registration applications and assist in market surveillance, thereby streamlining the process. 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 will be used to review applications, flag issues for staff, and provide faster feedback. The agency is also developing in-house tools for reviewing swap data and market surveillance. Selig emphasized that the CFTC is embracing technology, with staff being trained on Microsoft's Copilot. One of Selig's key initiatives has been overseeing the crypto industry, including the creation of a 'taxonomy' for digital assets in conjunction with the Securities and Exchange Commission. This system of definitions will help market participants understand how different subsets of crypto fit into various regulatory jurisdictions. The CFTC has also been involved in the regulation of prediction markets, which has been a contentious issue, with the agency suing several states over their attempts to regulate these markets. Selig reaffirmed the CFTC's commitment to taking action against bad actors in the markets, utilizing AI to enhance its enforcement capabilities.