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Key Takeaways:
- China warns of national security risks linked to crypto projects collecting iris scan data.
- Worldcoin’s biometric system faces regulatory scrutiny worldwide over privacy breaches.
- Authorities urge caution as biometric data misuse could enable espionage and cyber threats.
China’s Ministry of Security has issued a strong warning about the rising trend of cryptocurrency projects collecting sensitive biometric data, particularly iris scans. This cautionary stance highlights the potential privacy and national security risks posed by such data collection methods, with projects like Worldcoin, co-founded by Sam Altman, coming under scrutiny.
National Security Risks of Biometric Data Collection
In a recent security bulletin, China’s Ministry of Security emphasized the dangers of improper handling and storage of biometric information. The ministry cited concerns over a foreign company—widely believed to be Worldcoin—that collects iris scan data in exchange for crypto tokens. According to the statement, leaks of biometric data not only threaten personal privacy but can also compromise national security.
The bulletin warned, “Improper storage of relevant data can lead to leaks, which not only endanger personal privacy and property security but also pose a threat to national security.” Beijing’s warning comes amid increasing awareness of biometric misuse cases, including facial data stolen for deepfake creation, enabling espionage and infiltration of secure sites.
Worldcoin’s Controversial Biometric Approach
Worldcoin’s innovative but controversial biometric verification system, World ID, uses NVIDIA-powered “Orbs” to scan users’ irises as proof of humanness. This process aims to create a secure digital identity and reward participants with the platform’s WLD tokens.
Despite these technological advances, regulatory bodies in Germany, France, Kenya, and Hong Kong have already flagged Worldcoin for privacy violations and data protection breaches. For instance, Hong Kong’s investigation last year found Worldcoin violated multiple principles of its Privacy Ordinance related to data collection and retention.
In response to criticisms, Worldcoin advisor Liam Horne reassured the public at Consensus 2024 that the biometric data “literally never leaves the orb,” aiming to clarify misunderstandings about data security.
Also Read: Worldcoin Price Drops 22% as OpenAI’s $8.3B Raise Sparks Weekend Rebound Hopes
Global Regulatory Pushback and Future Implications
China’s explicit caution adds to the growing global regulatory pushback against biometric data use in crypto projects. Authorities are concerned that biometric data, if misused or leaked, could be weaponized for cybercrime or espionage, jeopardizing user privacy and national safety.
As biometric identification gains traction in the crypto space, projects will need to prioritize stringent security measures and transparent data practices to gain regulatory approval and public trust.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
