Setback for Sam Altman’s Worldcoin cryptocurrency project in Africa, as Kenya halts its iris-scanning data collection scheme
Worldcoin, a cryptocurrency project co-founded by OpenAI chief executive Sam Altman, has encountered a challenge to its unusual data collection scheme.
The government of Kenya in eastern Africa has banned the iris-scanning Worldcoin cryptocurrency project from recruiting new customers, amid concerns over its data privacy and security concerns, the Guardian reported.
Despite a crackdown on digital assets in multiple countries around the world, Worldcoin officially launched late last month with a highly unusual scheme.
The company’s main offering is a “World ID” that is backed by retinal scans carried out by a silver “orb” and which are designed to prove a user is human and not a bot.
Users who take part in the scanning process are eligible to receive Worldcoin tokens, also known as WLD.
The project is being carried out by a company called Tools for Humanity based in San Francisco and Berlin.
Worldcoin has 2 million users from its beta period and when it officially launched in July, it said it would scale up its identity-scanning operations to 35 cities in 20 countries.
As an incentive to participate, users in some countries are being offered free Worldcoin tokens.
The Guardian noted that Kenyans for example have been offered free Worldcoin tokens worth about 7,000 Kenyan shillings (£39) in order to sign up, with the project making a similar offer in other countries.
Local media have reported that more than 350,000 Kenyans had signed up for Worldcoin as of Tuesday this week.
The decentralised “World ID” is intended to anticipate a world in which AI-powered bots – such as OpenAI’s ChatGPT – become increasingly difficult to distinguish from humans, making proof of humanity more valuable.
Worldcoin also sees the World ID making projects such as a “universal basic income” (UBI) possible, since such endeavours would be required to ensure recipients were a real person.
But not everyone is happy at Worldcoin’s biometric data collection scheme for World ID.
Kenya’s interior ministry posted that the venture must stop collecting user data after raising a number of issues including: concerns over the secure storage of data that includes scans of a user’s iris; that offering crypto in exchange for data “borders on inducement”; inadequate information on cybersecurity safeguards; and placing large amounts of private data in the hands of a private business.
Joint Statement by CA and @ODPC_KE on operations of #Worldcoin in Kenya. @ikassait @ezraCHILOBA @ntvkenya @StandardKenya @citizentvkenya @KBCChannel1 @K24Tv @KTNNewsKE @MoICTKenya @EliudOwalo @ekisiangani @PeopleDailyKe @TheStarKenya @CapitalFMKenya @tv47news @NationAfrica pic.twitter.com/bx2IkjFqOe
— Communications Authority of Kenya (CA) (@CA_Kenya) August 2, 2023
“These issues require comprehensive inquiry to enable regulators to advise stakeholders on appropriate measures to protect the public,” said the Kenyan government.
“Controversies around WorldCoin are not new,” it added. “Similar concerns have been raised in other jurisdictions such as Germany, France, the United Kingdom and India.”
“Arising from these preliminary observations, a multi-agency investigation is underway,” it said. “Consequentially, and as directed by the government, the WorldCoin must cease its data collection activities in Kenya until further notice.”
The Worldcoin Foundation, a Cayman Islands-based entity, was quoted by the Guardian as saying it would work with authorities to boost understanding of privacy measures it has in place in Kenya and elsewhere.
“Worldcoin remains committed to providing an inclusive, privacy-preserving, decentralised on-ramp to the global digital economy and looks forward to resuming its services in Kenya while working closely with local regulators and other stakeholders,” it reportedly said in a statement.