Andreessen Horowitz Urges Treasury To Protect Digital ID Privacy

Andreessen Horowitz urged the U.S. Treasury to support privacy-preserving digital identity tools in a comment letter on illicit finance risks involving digital assets, centering its response on identity verification.

The firm submitted the letter Oct. 17, 2025, in response to a Treasury request dated Aug. 18, 2025. The GENIUS Act requires the Treasury secretary to seek public comment on application programming interfaces (APIs), artificial intelligence, digital identity verification, and blockchain technology and monitoring.

Identity systems fall into centralized, federated and decentralized models. Centralized or federated systems are managed by governments, financial institutions or other providers, while decentralized identity uses blockchain or another verifiable data registry and gives users control over personal data.

Under a decentralized model, an identity can be issued once and used across multiple organizations to verify a person's credentials. Users choose how much information to share and with whom.

Decentralized identifiers act as user-controlled authenticators. Verifiable digital credentials are cryptographically protected records that let issuers make attestations and allow others to validate them without an intermediary.

Andreessen Horowitz backed zero-knowledge proofs (ZKPs) and other privacy tools to address concerns that digital identity systems can enable surveillance. Cryptographic methods can give users control over how much personal information they share.

The firm pointed to investments in Spruce Systems, an open-source digital identity startup whose tools help users collect, control and own data online, and World, a privacy-preserving network intended to establish that people are human and unique.