FinCEN, FDIC to Hold 'Tech Sprint' for Digital Identity Tools

The proliferation of scams, information leaks and synthetic identity fraud is presenting a major challenge to the online financial services industry, federal regulators said.

AccessTimeIconJan 12, 2022 at 6:54 p.m. UTC
Updated May 11, 2023 at 3:43 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

Two federal regulators – the Financial Crimes Enforcement Network (FinCEN) and the Federal Deposit Insurance Corporation (FDIC) – have teamed up to host an upcoming “tech sprint” aimed at testing the effectiveness of digital identity proofing.

According to a joint announcement published Wednesday, digital identity proofing refers to the process of collecting, validating and verifying information about a person. This information is often used by financial institutions to establish proof of identity when customers are attempting to access services online.

As the financial services industry moves increasingly online, fraudsters and scammers have found new and inventive ways to commit financial crime. According to the FDIC and FinCEN, leaks and hacks of personally identifiable information (PII) and the rise in “synthetic identities” (a type of fraud in which someone creates a new identity from a mix of real and fake information) have made establishing a person’s true identity increasingly challenging.

In the upcoming tech sprint, which doesn't yet have a specific start date, participants will be asked to come up with a “scalable, cost-efficient, risk-based solution to measure the effectiveness of digital identity proofing to ensure that individuals who remotely (i.e., not in person) present themselves for financial activities are who they claim to be.”

FDIC and FinCEN’s goal is to increase the security of online financial services, reduce fraud and identity theft, cut down on money laundering and terrorist financing and improve customer confidence in the online financial services industry – something that has been challenged by the ongoing proliferation of scams.

Registration for the tech sprint – open to nonprofit organizations, private companies and academics – will begin in “coming weeks,” followed by a two-week application period.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Cheyenne Ligon

Cheyenne Ligon is a CoinDesk news reporter with a focus on crypto regulation and policy. She has no significant crypto holdings.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.