CFTC Establishes Task Force to Advance Regulatory Framework for Crypto and AI

The U.S. Commodity Futures Trading Commission (CFTC) has announced the formation of the Innovation Task Force (ITF) to establish a clear legal framework for derivatives markets in emerging areas such as crypto, artificial intelligence (AI), and prediction markets.

This task force will work directly with the CFTC to develop regulations for developers in blockchain, automated systems, and prediction markets. This move is seen as part of a strategy to make the U.S. a hub for the “future of finance.”

CFTC Chairman Michael Selig stated that establishing a clear legal framework will help promote responsible innovation while ensuring American businesses do not fall behind.

The ITF will be led by senior advisor Michael J. Passalacqua and will coordinate with other federal agencies such as the U.S. Securities and Exchange Commission and the agency’s crypto task force.

Recently, the CFTC has focused heavily on the explosion of prediction markets. The agency has issued compliance guidance for exchanges related to event contracts—popular products on platforms like Kalshi and Polymarket.

At the same time, the CFTC is seeking public input on proposed amendments or new regulations to oversee this sector amid growing concerns over insider trading and contracts related to sensitive events like war or terrorism.

Legal pressures are also mounting as several U.S. states challenge the CFTC’s authority. Arizona has accused Kalshi of operating illegal gambling, while Nevada has temporarily banned the platform.

Additionally, the CFTC recently signed a memorandum of understanding with Major League Baseball to limit markets that could threaten integrity. The agency also issued a notable ruling allowing Phantom self-custody wallets to access derivatives markets without registering as a broker.