Author: Liu Honglin
The Privacy Commissioner for Personal Data (PCPD) of Hong Kong has completed its investigation into the Worldcoin project and determined that its operations in Hong Kong violated the Personal Data (Privacy) Ordinance (PDPO).
On May 22, Privacy Commissioner for Personal Data, Ms. Chung Lai-ling, issued an enforcement notice to Worldcoin, ordering it to immediately cease all operations in Hong Kong that involve the use of iris scanning devices to scan and collect iris and facial images of the public.
The PCPD began investigating the Worldcoin project in January 2024 to determine whether the identity verification method posed a serious risk to the privacy of citizens’ personal data and violated the requirements of the Personal Data Protection Ordinance.
From December 2023 to January 2024, the PCPD conducted 10 secret visits to six locations involved in the operation of the Worldcoin project. According to the PCPD, during its operations in Hong Kong, Worldcoin scanned the faces and irises of 8,302 people for verification, and the collection of facial images was unnecessary to verify the authenticity of the participants because the iris scanning equipment operators were already able to conduct such verification in person at the operating location, making scanning or collecting facial images an unnecessary step; at the same time, Worldcoin's privacy statement did not have a Chinese version, which meant that non-English speaking participants could not understand the project's policies, practices, terms and conditions. In the PCPD's view, Worldcoin failed to provide sufficient information, hindering people from making informed decisions and true consent.
For the reasons stated above, the PCPD considered that Worldcoin’s collection of facial and iris images was unfair and unlawful, in violation of its data protection principles. The PCPD ruled that it was unreasonable for Worldcoin to retain sensitive biometric data, including facial and iris images, for up to 10 years for the sole purpose of training AI models.
Introduction to Worldcoin
Worldcoin's mainnet and its virtual currency Worldcoin were officially launched in more than 20 countries on July 24, 2023. After the launch, its price fluctuated several times. As of May 17, 2024, the price of Worldcoin has reached $4.863.
As of May 17, 2024, data published on the Worldcoin official website shows that Worldcoin has been online for 298 days, and World ID certified users cover more than 160 countries/regions. The Worldcoin official website claims that Worldcoin is committed to becoming the world's largest real-person identity and financial network, protecting privacy and owned by all people. Worldcoin aims to provide a channel for all people to participate in the global economy, regardless of country/region or background, and to establish a place for everyone to benefit in the AI era.
The co-founder of Worldcoin is Sam Altman. In addition to being the co-founder of Worldcoin, Sam Altman was also the president of the startup accelerator Y Combinator from 2014 to 2019, and the CEO of the artificial intelligence company OpenAI from 2019 to 2023. He is known for his belief in artificial general intelligence (AGI). He believes that AGI will be able to do anything that humans can do.
OpenAI launched the first version of the ChatGPT model in June 2020 and has since released several updated versions. The ChatGPT official website states: "Our mission is to ensure that general artificial intelligence benefits all of humanity."
Similarly, Worldcoin’s white paper also claims that its founding purpose is to create a global inclusive identity and financial network owned by the majority of humanity. If successful, it could significantly increase economic opportunity, provide a reliable solution to distinguish humans and AI on the Internet while protecting privacy, facilitate global democratic processes, and demonstrate the potential for an AI-powered basic income (UBI). potential paths.
Three Key Elements of Worldcoin
Worldcoin consists of three main elements: World ID, Worldcoin Token and World App.
1. World ID
World ID is a privacy-focused authentication method that allows users to verify that they are human online through a device called Orb while maintaining their privacy. This verification is based on zero-knowledge proof technology, so it can ensure that the identity is verified without revealing user details. World ID is personal and only available to its holder. Even if it is lost or stolen, the user can retrieve the World ID.
2. Worldcoin Token
To encourage growth in the number of users, Worldcoin will distribute tokens to all network participants. This has the potential to make Worldcoin the most widely distributed digital asset.
3. World App
World App is the first application of World ID. It guides users through identity authentication through Orb, manages users' World ID credentials, and shares them with third parties while protecting privacy. The app also provides seamless access to global decentralized financial services.
Worldcoin is based on World ID, with the goal of fair airdrops, protecting social media from bot/sybil attacks, and achieving fair distribution of limited resources. If you want to participate in the Worldcoin protocol, you should first download the World APP and authenticate your identity through Orb to obtain a World ID.
Features of Worldcoin — Biometric Verification
The distinguishing feature of Worldcoin is the biometric verification of each unique person. The idea of Worldcoin is that rapidly developing artificial intelligence can produce a lot of content that people can trust to be "human". Therefore, inclusivity and privacy protection are extremely important in the operation of public infrastructure. If you use a verification method to ensure that every piece of information or transaction contains "verified human attributes", you can filter out a lot of noise from the digital world. Currently, Web3's collective decision-making relies heavily on the management of tokens, which results in some people being excluded from the governance system and at the same time leads to those with more economic power taking advantage. Therefore, it is becoming increasingly important to include every individual in the governance system, which will be the basis for artificial intelligence to maximize the benefits to all human beings.
Authentication of every real person through biometric verification is also related to the allocation of social resources. With the advancement of artificial intelligence, the fair distribution of usage rights and some of the created value through UBI will play an increasingly important role in offsetting the concentration of economic power. Decentralized personality proof protocols can assist any project or organization in the world to achieve fair distribution of resources. Obtaining a World ID through biometric verification ensures that each person is verified only once, preventing multiple registrations and ensuring fair distribution. In addition, biometric verification can also effectively ensure the security of the World ID, ensuring that only the individual holding the ID can use it, and recovering it in the event of loss or damage.
Worldcoin uses iris biometrics to verify personal information. Tools for Humanity, an advisor to the Worldcoin Foundation and operator of the World App, released Orb to complete the aforementioned verification.
Reasons why Worldcoin is restricted
The Worldcoin Foundation Terms and Conditions state: “In order to use the Services… you must meet all of the following conditions: You are not located in, under the jurisdiction of, or a national or resident of Syria, Crimea, Donetsk, Luhansk, Kherson and Zaporizhia regions of Ukraine, Russia, North Korea, Iran, Cuba, or any other country or region in the United States, the European Union or any other country or jurisdiction to which access to the Services is restricted… If you do not meet all of these requirements, you may not access or use the Services.”
1. Impact of virtual monetary policy
The policies, laws, and regulations applicable to virtual currencies vary greatly from country to country, so the market environment faced by virtual currencies in different countries is also ever-changing. Worldcoin tokens, as a virtual currency, are no exception. Different countries have different attitudes towards virtual currencies, so the purchase and use of Worldcoin tokens are restricted in some countries. Some countries restrict virtual currencies out of consideration for preventing financial risks and illegal activities.
China. On December 3, 2013, Chinese regulators issued the “Notice on Preventing Bitcoin Risks” (Yinfa [2013] No. 289). The notice stated that “in order to protect the property rights and interests of the public, safeguard the legal tender status of the RMB, prevent money laundering risks, and maintain financial stability”, “Bitcoin should be a specific virtual commodity, which does not have the same legal status as currency, and cannot and should not be circulated and used as currency in the market”. From 2013 to 2014, China positioned Bitcoin as a “virtual commodity”, allowing the public to hold it at their own risk, while prohibiting banks, payment institutions, etc. from providing services for Bitcoin transactions. Between 2017 and 2019, Chinese regulators issued a series of regulatory policies on virtual currencies, declaring ICOs illegal, prohibiting trading platforms from operating in China, and also prohibiting the mining industry. On September 15, 2021, Chinese regulators issued the "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237), pointing out that "recently, virtual currency trading speculation activities have been on the rise, disrupting the economic and financial order, breeding illegal and criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes, money laundering, and seriously endangering the property safety of the people. In order to further prevent and deal with the risks of virtual currency trading speculation and effectively safeguard national security and social stability", it also stipulates that virtual currency-related business activities are illegal financial activities, and if engaging in virtual currency-related business activities constitutes a crime, criminal liability shall be pursued in accordance with the law.
South Korea. In September 2017, South Korea’s Financial Services Commission (FSC) issued a decision banning ICOs and credit transactions in virtual currencies. According to South Korea’s News1Kim, FSC Vice Chairman Kim Yong-Bum said: “Financial authorities are banning ICOs. The purpose is to prevent consumers from overheating due to a surge in speculative receivable demand caused by an increase in ICO fraud, thereby damaging the market. "On July 18, 2023, the FSC promulgated the "ACT ON THE PROTECTION OF VIRTUAL ASSET USERS" (ACT ON THE PROTECTION OF VIRTUAL ASSET USERS). The bill states that the purpose of this law is to protect the rights and interests of virtual asset users and promote the establishment of transparency and sound trading practices in the virtual asset market by stipulating asset protection for virtual asset users, supervision of unfair trading practices and related matters. . The bill makes specific provisions on virtual assets in terms of user asset protection, unfair trade regulation, supervision and disposal.
2. Application of biometric technology
The fact that Worldcoin uses iris biometrics to verify personal information is also the reason why it is restricted in some countries.
Kenya. Kenya was one of the first countries to launch Worldcoin registration certification. But later, the Kenyan government issued a ban, suspending Worldcoin registration certification in the country. The Kenyan Ministry of Internal Affairs announced in a statement that "Worldcoin activities are suspended immediately until relevant government agencies prove that there is no public risk." The government said that "the government is concerned about (Worldcoin) activities to register citizens by collecting eye/iris data" and said that an investigation has been launched to "determine the authenticity and legality of the activities, the security and protection of the collected data, and how the collector intends to use the data."
France. France is skeptical about Worldcoin's collection of user iris information. France's data protection regulator, the French National Commission for Information and Freedoms (CNIL), has questioned Worldcoin's biometric data collection methods, especially its legality and storage conditions. As a result, the CNIL launched an investigation into Worldcoin's data collection and processing activities with the aim of ensuring that these activities comply with French and European data protection regulations. The investigation was also assisted by the authorities of the German state of Bavaria.
Germany. The Bavarian State Office for Data Protection Supervision has also conducted an investigation into Worldcoin’s processing of sensitive biometric information, which began in November 2022. The office raised concerns about Worldcoin’s large-scale processing of biometric information and stated that these technologies are “neither mature nor adequately analyzed for the specific core purpose of processing financial information.”
Spain. The Spanish Data Protection Agency (AEPD) has ordered Worldcoin to stop collecting and processing data in Spain and issued a three-month temporary injunction. The AEPD's order claims that the agency is investigating complaints about the inability of Spanish users to withdraw consent and Worldcoin's alleged collection of data from minors. "The AEPD requires the cessation of the collection and processing of special categories of personal data and the blocking of data that has already been collected. The AEPD has received complaints, including about insufficient information, the collection of data from minors, or not allowing the withdrawal of consent."
summary
The Worldcoin project carries the beautiful vision of its founder. The white paper proudly declares that Worldcoin will respect user privacy, integrate all people into the global economy regardless of country, region, and background, and create a global inclusive identity and identity owned by the majority of mankind. financial network. It works to significantly increase economic opportunity and promote democratic progress around the world. But in fact, the operation of Worldcoin is affected by the virtual currency policies of various countries. In addition, Worldcoin’s collection of biometric data has also led to its investigation and restrictions.
