March 12, 2021
DFS ANNOUNCES WINNERS OF TECHSPRINT ON DIGITAL REGULATORY REPORTING IN CRYPTOCURRENCY
Demo Day Featured Keynote Fireside Remarks by Superintendent Lacewell and PayPal CEO Dan Schulman
Three Winning Teams Showcase Solutions to Advance Digital Regulatory Reporting
The New York State Department of Financial Services (DFS) today concluded its first-ever Techsprint with a public Demo Day featuring a keynote fireside chat between Superintendent of Financial Services Linda A. Lacewell and PayPal CEO Dan Schulman. Wrapping up a two-week exercise that attracted participation from nearly 100 professionals in cryptocurrency and financial regulation, a panel of judges selected winners in three categories: (1) Greatest Industry Impact; (2) Most Creative Implementation; and (3) Most Functional Prototype.
“These fresh and innovative proposals will help the Department fulfill its vision of becoming the regulator of the future, to better serve consumers and uphold the safety and soundness of the firms we supervise,” said Superintendent Lacewell. “This Techsprint is a testament to what we can accomplish when government and industry come together to deliver actionable solutions that will lead to a stronger and more transparent marketplace. Congratulations and thank you to all participants, our partners at CSBS, AIR, and to our brilliant judges.”
Before the winners were announced, Superintendent Lacewell and Mr. Schulman discussed the future of finance, the evolution of cryptocurrency and the importance of innovation in regulation during a fireside facilitated by Jo Ann Barefoot, CEO and Co-Founder of the Alliance for Innovative Regulation (AIR).
The Techsprint winners include:
- Greatest Industry Impact: CryptoKnight for risk-scoring solutions;
- Most Creative Implementation: Crypto Avengers for groundbreaking prototype and innovative design; and
- Most Functional Prototype: Block-Busters for building the most useable tech
The Department recognized SAURONChain as an honorable mention for performing well across categories.
“The lessons learned from this Techsprint are invaluable and will inform the future of digital supervision as we improve efficiencies for both state regulators and financial companies,” said CSBS President and CEO John W. Ryan. “Events like this help us advance Networked Supervision, our initiative to unite the state system through technology. State regulators have been pleased to join NYDFS and AIR in this effort, and we look forward to future opportunities.”
“AIR is honored to work with DFS and CSBS on this unprecedented Techsprint, equipping regulators with powerful technology tools to monitor the companies they oversee -- in this case cryptocurrency firms,” said Jo Ann Barefoot, CEO & Co-founder of AIR. “Digital regulatory reporting that taps into abundant, timely data is critical to keeping financial regulators on pace with today's fast-changing world.”
Nine teams worked to address one or more of the following four problem statements over the course of two weeks from March 1 through March 12, 2021:
- How can DFS achieve real-time or more frequent access to company financial data from virtual currency licensees and receive early warning signs of financial risks to the companies or their customers?
- How can DFS obtain real-time transaction data from its licensees and automatically analyze the data to safeguard against illicit financing risks?
- How can DFS use tools such as natural language processing, machine learning, and artificial intelligence to identify risks by processing and analyzing supervisory reports that are submitted by licensees in a wide range of formats?
- How can DFS use technology to facilitate information-sharing among licensees to help them more quickly identify and stop scams, ransomware strikes, and other criminal enterprises that put licensees and their customers at risk?
These problem statements were the product of extensive engagement conducted by the Department in advance of the Techsprint, soliciting the input of industry thought leaders and state, federal and international regulators, among other stakeholders.
The Techsprint was produced in collaboration with the Conference of State Bank Supervisors (CSBS) and the Alliance for Innovative Regulation (AIR) and engaged over 85 volunteer professionals from a variety of backgrounds and affiliations across 8 time zones globally. DFS would like to congratulate the winning teams and recognize all participants, judges, observers, subject matter experts and staff who collaborated to make the Techsprint a successful and stimulating event.