Worldcoin Halts Operations in Spain Upon Data Watchdog’s Pressure

Tools for Humanity Corporation, Worldcoin’s parent company, has reached an agreement with the Spanish Agency for Data Protection (AEPD) to stop its operations until the end of 2024. The stoppage of operations comes due to growing concerns about its data storage and usage practices among regulators.

Worldcoin faces rising friction from regulators due to its policies surrounding the use of personally identifiable information, like facial patterns and iris scans. It offers users the WLD token in exchange for using it to create digital identities – the only caveat is that it stores scanned information for up to 10 years.

Data regulators worldwide are raising red flags about Worldcoin’s operations and policies due to concerns about unethical usage of such sensitive information. The threat of a global database of sensitive information getting hacked is another massive worry for regulators looking to protect the users in their jurisdictions.

Hong Kong has also halted Worldcoin’s activities because of the data storage and usage policies, and the enforcement took effect on May 22. The blockchain-based company maintains it uses this sensitive data to train AI models to expand the use cases of its decentralized utility, including the decentralized identity use case it offers.

Another region looking into Worldcoin’s practices is Germany, specifically Bavaria, with the German state’s agency Bayerisches Landesamt für Datenschutzaufsicht (BayLDA) investigating its handling of user data. The Spanish demand for Worldcoin to stop collecting and using user data is tied to BayLDA’s investigation, and Worldcoin’s functioning status in Spain will depend on the investigation’s outcome.

The agreement to stop will remain until the end of the year or sooner, if BayLDA’s investigation concludes before December ends. Nevertheless, Worldcoin witnesses growing usage, with more users jumping on the platform to submit personal information for WLD assets. The company plans on extending more utility to the Web3 space and increasing its token supply soon. It recently launched its blockchain network, World Chain, in April.

Image: WorldCoin