Compiling a XAML-based project fails in Visual Studio in a FIPS-enabled environment with an error message stating "This implementation is not part of the Windows Platform FIPS validated cryptographic algorithms".
This bug has been fixed in .NET 4.7.1. As of August 2017, this fix has been released as part of .NET 4.7.1 early access builds and Windows 10 Insider Preview builds from the RS3 (Redstone 3) branch.
After publishing a recent blog entry about Visual Studio issues in a FIPS-enabled environment, I was contacted by another user who was encountering a somewhat similar problem. Their XAML based projects (created in VS 2010) were throwing the FIPS error when trying to compile in VS 2013 and VS 2015. While the error message was the same, the root cause was different and hence the workaround prescribed in the other article did not solve the problem. After working with the customer to obtain a stack trace, the development team investigated the trace and discovered that the underlying issue was recently resolved and fixed in the .NET 4.7.1 update.
If you encounter any other issues in FIPS-enabled environments, please comment below and I'll help to investigate.
Sam Lester (MSFT)