FIPS: installer crashes with "Failed to format device: Invalid argument" when encrypting a partition with default settings

Issue

• Trying to install a system with FIPS enabled (fips=1 on kernel command line), the installer crashes with the following error message when trying to encrypt a partition

  An unknown error has occured, look at the /tmp/anaconda-tb* file(s) for more details
  
    File "/usr/lib64/python3.9/site-packages/pyanaconda/installation_tasks.py", line 496, in start
      self.run_task()
    File "/usr/lib64/python3.9/site-packages/pyanaconda/installation_tasks.py", line 311, in start
      item.start()
    File "/usr/lib64/python3.9/site-packages/pyanaconda/installation_tasks.py", line 311, in start
      item.start()
    File "/usr/lib64/python3.9/site-packages/pyanaconda/installation_tasks.py", line 311, in start
      item.start()
    File "/usr/lib64/python3.9/site-packages/pyanaconda/installation.py", line 399, in run_installation
      queue.start()
    File "/usr/lib64/python3.9/threading.py", line 917, in run
      self._target(*self._args, **self._kwargs)
    File "/usr/lib64/python3.9/site-packages/pyanaconda/threading.py", line 275, in run
      threading.Thread.run(self)
  dasbus.error.DBusError: Failed to format device: Invalid argument
  

• The /tmp/anaconda-tb* file(s) show the following messages

  INFO:program:[cryptsetup] PBKDF max memory or parallel threads must not be set with pbkdf2.
  05:25:22,059 WARNING org.fedoraproject.Anaconda.Modules.Storage:INFO:program:[cryptsetup] PBKDF max memory or parallel threads must not be set with pbkdf2.