by Vincent Muthee
China has warned against the collection of biometric data in exchange for tokens by crypto projects. In the warning, the nation’s Ministry of State Security (MSS) cited national security concerns claiming that biometric data, unlike passwords, once collected cannot be changed.
While China did not give any specifics, it specifically cautioned against mass iris scanning crypto projects. This description fits Sam Altman’s Worldcoin project, now rebranded as “World”. The World project uses the “proof-of-personhood” system (famously known as ‘The Orb’) to scan users’ irises for unique verification purposes before distributing its native token, WLD, to users.
China Cites Surveillance and National Security Concerns
As per the bulletin published by the MSS on August 6, 2025, China showcases the iris scanning practice by crypto projects, in exchange of tokens, as a dangerous practice. The MSS argues that this data could not only pose risks to personal privacy but also to national security.
“There are “public cases” showing that an overseas company uses the issuance of cryptocurrency tokens as a gimmick to scan and collect user iris information around the world and transfer data sources, posing a threat to the security of personal information and even national security,” the security bulletin noted.
China Warns: Worldcoin-style iris scanning by foreign crypto firms poses a national security threat, says the Ministry of State Security.
– Biometric data = sensitive national asset
– Concerns over misuse & surveillance
– Crypto used as bait for data extraction pic.twitter.com/Oo4zvRrL9z— Bitinning (@bitinning) August 6, 2025
According to the MSS, these systems could enable outside influence over Chinese citizens and threaten internal stability. The ministry added that once biometric data is collected and uploaded to decentralized systems, it becomes nearly impossible to recover or delete – posing a permanent risk to national security.
The ministry also emphasized concerns about the “monetization” of personal data and the possibility of exported identity information, stating that such trends could challenge China’s sovereignty in managing its population’s digital footprint. China’s MSS advised Chinese citizens against getting involved in such crypto schemes and urged government entities to place more emphasis on monitoring foreign crypto projects.
The caution fits into a China’s larger efforts to establish data sovereignty and restrict the access of foreigners to sensitive information. This is crucial, particularly as AI and blockchain technology continue to become more integrated into everyday life.
An Indirect Hit at Sam Altman’s Iris Scanning World Project?
The latest warning by China is akin to measures taken by Kenya and Indonesia, both of which halted Worldcoin operations citing ‘suspicious activity’. Back in May 2025, the High Court of Kenya objected to Worldcoin’s collection of personal data asking the project to delete all collected data. In tandem, Indonesia also threatened to prosecute breaches of consumer laws.
Though Worldcoin claims that its biometric onboarding system is fair, guaranteeing one person, one wallet in digital economies, critics say that it introduces a single point of failure. This being, tying digital identity with a centralized biometric registry even though it is based on decentralized infrastructure.
Sam Altman’s dual role as the CEO of Worldcoin and OpenAI (accused of privacy violations) adds more fuel to the growing scrutiny around Worldcoin. His affiliation with Worldcoin raises global concerns regarding privacy, identity and monetization of human data.
WLD Dips as China Warns Against Iris Scanning Projects
As of this writing, WLD, the native token of Worldcoin, was trading at $0.9387, down by 2.3% over the last 24 hours, according to data by CoinGecko. The decline follows China’s warning and the existent regulatory scrutiny around the project in various nations.
Worldcoin has struggled to regain momentum to previous price peaks as the World project remains under pressure. Despite backing by prominent figures, the uncertainty around the future of biometric-based crypto solutions keeps investors abay.
#blockchain #crypto, #decentralized, #distributed, #ledger
