US CFTC boosts crypto, prediction market surveillance with AI

The U.S. Commodity Futures Trading Commission (CFTC) is strengthening its oversight of cryptocurrency and prediction markets by using an AI-based surveillance system to detect abnormal trading and crack down on market manipulation, Wired reported. CFTC Commissioner Mike Selig explained that the agency is using AI to analyze patterns in large-scale trading data. This helps identify accounts potentially involved in insider trading or market manipulation and informs decisions on whether to investigate and issue subpoenas. The CFTC also reaffirmed its position that it can apply extraterritorial jurisdiction to offshore platforms like Polymarket if U.S. users are involved. The agency is reportedly combining on-chain analysis tools such as Chainalysis with its existing market surveillance systems to simultaneously track transactions in both cryptocurrency and traditional financial markets.