Imagine an exchange identifying a fraud scheme and helping another firm recognize the same threat before its customers lose money, all without handing over its customer database or exposing confidential investigative records.

That is the opportunity for a new approach to digital asset threat prevention: a shared intelligence network that combines blockchain infrastructure, zero-knowledge proofs, and clear regulatory permission to collaborate.

Over the past several years, I have been exploring this concept with FinCEN and Treasury. The question is straightforward: how can financial institutions share enough information to protect one another while preserving the confidentiality of the information entrusted to them?

The answer could change how we prevent financial crime.

From isolated warnings to collective prevention

Individual firms often hold different pieces of the same threat picture. One identifies a compromised account. Another detects a suspicious wallet. A third recognizes a device associated with repeated fraud attempts. Connecting those signals could help institutions identify coordinated activity earlier.

But sharing intelligence introduces difficult questions about customer privacy, commercial confidentiality, liability, and regulatory obligations. In my conversations with firms, uncertainty about those boundaries remains a significant barrier to participation.

A network designed around privacy could help address that hesitation.

Zero-knowledge proofs allow a party to demonstrate a specific fact without revealing the underlying information. Combined with other privacy-preserving techniques, they could support narrowly tailored queries: does this wallet match a qualifying threat indicator contributed by another participant? Has a particular pattern appeared across multiple institutions?

A blockchain could provide a shared record of contributions, permissions, and verification, while sensitive source records remain with the originating institution. Such a system would require careful engineering: even a limited answer can reveal sensitive information, and cryptographic verification cannot establish whether an underlying allegation is true.

The policy foundation — and the unfinished work

Section 314(b) of the USA PATRIOT Act already provides a voluntary safe harbor for qualifying information sharing among eligible financial institutions and associations. FinCEN’s June 2026 guidance confirms that the safe harbor extends to suspected fraud and expressly permits real-time and electronic sharing. These are meaningful foundations for innovation.

The next step should be explicit treatment of privacy-preserving threat networks.

FinCEN should also clarify how information learned through these systems informs existing investigation, recordkeeping, and suspicious activity reporting duties. A zero-knowledge design should not be assumed either to eliminate those duties or to create money-transmitter status. FinCEN’s existing approach distinguishes software production from activities involving acceptance and transmission of value.

I believe a targeted rulemaking deserves serious consideration to establish durable rules and protections for this model. That process should identify what existing authority already permits and where changes are necessary. It must also preserve SAR confidentiality: Section 314(b) does not itself authorize sharing SARs or revealing their existence.

Build on the institutions already doing this work

The United Kingdom offers a useful institutional example. Cifas, an independent nonprofit membership organization, enables public- and private-sector participants to share fraud-risk intelligence. Its experience illustrates the value of sustained cooperation within a defined governance framework.

The digital asset ecosystem has foundations of its own. Crypto ISAC facilitates security intelligence sharing, while TRM Labs’ Beacon Network connects investigators and industry participants to accelerate responses to suspected illicit funds. Both should be part of the conversation about a broader, interoperable threat intelligence network.

A practical next step would bring these organizations together with financial institutions, privacy technology developers, FinCEN, and Treasury to design a limited pilot. Access controls, evidence standards, correction procedures, and independent oversight should be built into its operation.

With clear rules and thoughtful design, blockchain technology could help turn fragmented intelligence into collective prevention.