CFTC Forms New Advisory Panel to Guide Blockchain and AI Regulation

Commodity Futures Trading Commission Chairman Michael Selig launched the Innovation Advisory Committee to provide expertise on emerging technologies reshaping financial markets, marking his first major policy initiative since taking control of the derivatives regulator last month.

The newly renamed panel replaces the former Technology Advisory Committee and will include representatives from financial institutions, regulatory bodies, technology providers, public interest groups, academia, and market infrastructure firms, with charter members drawn from the CEO Innovation Council established by former Acting Chair Caroline Pham.

Selig is seeking additional nominations through January 31 as the agency prepares regulatory frameworks for artificial intelligence, blockchain, and cloud computing applications in commodity derivatives markets.

The chairman positioned the committee as central to developing what he called “clear rules of the road for the Golden Age of American Financial Markets,” while Congress prepares to finalize comprehensive digital asset legislation.

Selig Signals Innovation Focus Following Pham’s Digital Asset Legacy

The IAC launch comes as Selig inherits an agency transformed by Pham’s aggressive modernization efforts during her tenure as acting chair.

Pham’s final year delivered regulatory breakthroughs, including spot crypto trading on CFTC-registered exchanges, approval of a digital asset markets pilot program accepting Bitcoin, Ether, and USDC as collateral, and no-action relief for four prediction market operators.

She deployed the agency’s first automated market surveillance system while granting regulatory relief that unlocked tens of billions in capital for market participants.

“A wide range of novel technologies are enabling the creation of entirely new products, platforms, and businesses and transforming the financial markets landscape,” Selig said in announcing the committee.

“Innovators are harnessing technologies such as artificial intelligence, blockchain, and cloud computing to modernize legacy financial systems and build entirely new ones.“

The committee’s charter directs members to provide advice on technological innovation’s commercial, economic, and practical implications across financial services, derivatives, and commodity markets, while recommending appropriate technology investment levels to support the agency’s surveillance and enforcement capabilities.

Selig’s appointment follows his Senate confirmation in December, after serving as chief counsel of the SEC’s Crypto Task Force and as a senior advisor to SEC Chairman Paul Atkins, where he developed regulatory frameworks for digital asset securities markets and contributed to the President’s Working Group report on strengthening American leadership in digital financial technology.

His career in private practice involved advising derivatives clients and digital asset companies on regulatory matters at a major law firm, providing him with direct exposure to the compliance challenges faced by exchanges, trading platforms, and institutional market participants.

Committee Formation Occurs Amid Legislative Uncertainty on Crypto Markets

The advisory panel’s establishment coincides with turbulent negotiations over Senate digital asset legislation that have missed multiple deadlines throughout 2025.

Senate Agriculture Committee Chairman John Boozman postponed a planned markup of the Digital Asset Market Clarity Act to late January, citing the need for additional time to finalize policy details following weekend negotiations with Democratic lead Senator Cory Booker.

Traditional banking groups intensified lobbying to restrict stablecoin rewards beyond the GENIUS Act’s framework, with Coinbase threatening to withdraw support if negotiators insert restrictions beyond enhanced disclosure requirements.

Three Democratic senators demanded a full hearing before Thursday’s markup, criticizing the lack of text just two days before the vote on what they called “the most significant law considered by the committee this century.”

The legislation affects 68 million American crypto owners and the $3 trillion digital asset market. However, TD Cowen recently warned that the 2026 midterm elections could delay passage until 2027, as Democrats may withhold support ahead of the next electoral cycle.

Meanwhile, Senator Cynthia Lummis introduced standalone legislation to protect non-custodial blockchain developers from being classified as money transmitters, emphasizing that “code is not custody” and that enforcement actions risk criminalizing open-source software development.

For this new committee, Selig pledged to oversee “the stability and security of America’s commodity derivatives markets during this period of rapid transformation” while ensuring innovations remain U.S.-based, stating, “Under my leadership, the CFTC will conquer these great frontiers and ensure that the innovations of tomorrow are Made in America.“