Worldcoin’s Controversial Iris Scans: Should You Trade Your Biometric Data For Crypto

Worldcoin, the controversial eyeball-scanning crypto project, officially launched in 2023 with its identity verification technology and native cryptocurrency, $WLD

Worldcoin, a crypto project that aims to create a blockchain-based identity system, officially launched in 2023. The project, backed by OpenAI CEO Sam Altman, has sparked debates, especially within the #CryptoPH community, where iris-scanning activities are currently being conducted.

To participate in Worldcoin, individuals must download the World App, the project’s protocol-compatible wallet, and visit an Orb to verify their identity. The Orb scans the user’s iris and converts the biometric data into a unique cryptographic code, known as a World ID.

Here's a step-by-step guide on how to participate in Worldcoin and claim your $WLD tokens.

To rapidly get its new currency into the hands of as many people as possible, Worldcoin will allow everyone to claim a share of it for free. For this to happen, we first had to solve one major challenge: ensuring that every person on Earth can prove that they are indeed human (not a bot), and that they have not claimed their free share of Worldcoin already.

To achieve this, Worldcoin created a unique identity, called World ID, that is linked to a person’s iris scan and cannot be faked or transferred. Everyone who gets a World ID also receives an equal share of the Worldcoin cryptocurrency ($WLD), which is capped at 10 billion tokens for the initial 15-year period.

Worldcoin is positioned as a globally distributed cryptocurrency with a total supply that is set to increase over time. At launch, the circulating supply of the ERC-20 token stood at 143 million tokens. Here's a closer look at the tokenomics of $WLD.

A key question surrounding Worldcoin is whether it qualifies as a Virtual Asset Service Provider (VASP) under financial regulations.

According to Worldcoin, the company is a self-custodial wallet provider and does not engage in VASP activities. Here's their statement on the matter:

“Worldcoin is not a Virtual Asset Service Provider (VASP) or another similar classification. We do not custody or exchange cryptocurrency on behalf of others. As a self-custodial wallet provider, we are not required to register with any financial regulator.”

While Worldcoin promises a secure and innovative identity verification system, it has faced widespread criticism globally.

Privacy & Data Security Risks

Worldcoin's iris-scanning technology and data collection practices have raised concerns among privacy advocates and regulators. Here are some key points:

- Biometric data, once compromised, cannot be changed or recovered.

- Worldcoin's technology scans both eyes, collecting highly sensitive biometric information.

- The company claims to delete the raw iris scans after processing, but critics argue that the data could still be reconstructed.

- Worldcoin's privacy policy states that it may share anonymized and aggregated data with third parties for research and analysis purposes.

- The company's use of third-party service providers and the potential risks to user data also need to be considered.

Regulatory Scrutiny

Countries such as Kenya, Germany, and France have raised concerns about Worldcoin's activities and regulatory status. Here are some key points:

- Kenyan authorities have expressed skepticism and concerns regarding Worldcoin's operations in the country, specifically questioning the legality of its activities and the potential risks to citizens.

- German regulators have classified Worldcoin as a crypto wallet provider and not a VASP, which aligns with the company's self-designation.

- French authorities have raised concerns about Worldcoin's data collection practices and regulatory status, considering the company's activities to be within the scope of VASP regulations.

- The varying regulatory approaches and interpretations highlight the challenges in defining and regulating emerging crypto projects and technologies.

Are Worldcoin’s Onboarding Practices Exploitative?

According to a report by MIT Technology Review, another major criticism is how Worldcoin recruits participants, particularly in developing countries where financial incentives are more appealing. Here are some key concerns:

- Worldcoin representatives reportedly prioritize sign-ups without fully explaining the project or obtaining informed consent.

- Some users claim to have been misled about the purpose of the iris scan and the use of their data.

- Reports indicate that Worldcoin employees are instructed to downplay the cryptocurrency aspect and emphasize the broader goal of creating a universal identity system.

- Critics argue that the company's tactics and practices prioritize mass adoption over ethical considerations and informed consent.

Worldcoin’s Response to Criticism

To address privacy concerns, Worldcoin has assured users that:

- Raw iris scans are deleted after processing, and only cryptographic hashes are stored on the blockchain.

- Anonymized and aggregated data may be shared with third parties for research and analysis.

- Users can opt out of the data-sharing program at any time by deleting their World App account.

- Worldcoin claims that its technology is fully compliant with the General Data Protection Regulation (GDPR).

However,