Crypto Firms Face Surge in AI-Driven Identity Verification Activity
AI-generated image · Bay Street Wire
A new report from Regula indicates that nearly half of surveyed crypto companies have confirmed the use of AI or automation by users during KYC checks.
As the Financial Post first reported, a global study conducted by identity verification provider Regula reveals that 44% of surveyed crypto firms have confirmed AI-assisted or automated activity among users undergoing identity verification. This rate is 13 percentage points higher than the 31% reported by other surveyed sectors.
Regula defines this activity as automated behavior identified via post-incident reviews or investigations, including scripts interacting with verification flows or AI agents acting on behalf of customers. The report notes that the presence of AI or automation does not automatically confirm a successful attack or that fraud occurred.
While AI is a growing factor, the Financial Post reports that crypto respondents cited counterfeit, stolen, or altered identity documents as a more frequent threat (44%) than AI-generated impersonations or deepfakes (37%).
The data also highlights differences in how crypto firms handle identity decisions compared to other industries. According to the Regula study, 62% of crypto respondents can fully reconstruct an identity decision—including the evidence and logic used—compared to 49% in other sectors. Additionally, 87% of crypto firms reported receiving external requests to explain identity decisions, while 81% of other surveyed sectors reported the same.