In a recent development, Kenya’s Ministry of the Interior has taken a bold move of suspending the operations of Worldcoin within its jurisdiction. Worldcoin is an identity crypto protocol founded by Sam Altman of OpenAI. The country raises alarming concerns over the legitimacy of the project, its financial security, and the measures adopted by Worlcoin to protect the user’s data. The official announcement ordering the local authorities to thoroughly conduct an investigation on the project and halt the Worldcoin operations in the country was made through a statement on the Ministry’s Facebook page.
Background of Worldcoin
Worldcoin is a cryptocurrency project spearheaded by the renowned entrepreneur and CEO of OpenAI, Sam Altman. The idea behind the launch of Worldcoin is to create a Universal Basic Income (UBC) in the form of cryptocurrency. This would provide a fixed income to all its citizens irrespective of their economic status, background, or country in the form of WLD tokens.
The project was founded three years ago but is finally in the market now with the vision to establish a globally inclusive identity solution and financial system, owned and operated by individuals. The Worldcoin revolves around the World ID, also termed by the company as a “digital passport”. World ID is a privacy-preserving digital identity solution that proves that an individual owning the ID is not an AI bot but a real human.
In order to acquire a World ID, customers must sign-up and complete an in-person iris scan using a special biometric device called ‘orb’. Once the orb’s iris scan verifies an individual as a real human, the World ID is created. In order to enhance user experience, the company has also created its first wallet app, World App.
Scrutiny of the Worldcoin Project
The world to achieve this vision is not smooth. This cryptocurrency project has faced severe scrutiny for its method of using biometric devices to collect user data and make them a part of Worldcoin. There has been a growing concern over the security and privacy of user data. Critics globally dispute that such practices can be of exploitative nature, especially in those countries that lack strict rules and regulations around data protection.
The concern around data protection has already struck the European regulators with the Bavarian data protection office keeping a close watch on the firm’s activities. However, Kenya lands as the first to suspend the firm’s activities in the country issuing stringent orders to the local authorities to conduct a detailed investigation. The statement released by the Ministry expresses concerns about the transparency of Worldcoin functioning and potential risks to public safety that can arise with the use of biometric data.
The Impact on Worldcoin
The order on the halt of Worldcoin’s operation in Kenya is undoubtedly a major setback for the firm looking to expand its jurisdiction and be a global currency. In the wave of this suspension, the WLD token has witnessed an unexpected increase in its trading volume with the current trading price of around $2.41. Further, the Kenyan Capital Markets Authority (CMA) has issued a cautionary statement stating that neither the project nor its token fall under its regulatory oversight. They also express their interest in collaborating with the project within its regulatory sandbox.
The incident serves as a reminder that financial security and privacy are the most important factors for any innovation. Worldcoin should showcase a proactive approach to gain its user’s trust and confidence by addressing such issues. The result is unknown, the project could either appeal the decision or permanently cease to operate in Kenya.
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
