Worldcoin, a cryptocurrency project known for its controversial approach to capturing identity data, is currently under investigation in Singapore for potential involvement in money laundering and terrorism financing. The scrutiny comes as authorities examine the legality of transactions involving Worldcoin accounts and tokens.
Investigation Unveiled
On September 9, Gan Kim Yong, Singapore’s Deputy Prime Minister and Chairman of the Monetary Authority of Singapore (MAS), announced that a probe was underway regarding a group of individuals engaged in the third-party sale and purchase of Worldcoin accounts and tokens. This investigation focuses on whether these activities breach Singapore’s regulatory frameworks.
During a parliamentary discussion, Yong revealed that seven individuals are currently under police investigation for conducting Worldcoin-related transactions without proper licenses. According to the Payment Services Act 2019, operating such services without a license is a legal offense.
Yong stated, “Based on information provided to MAS, Worldcoin does not perform a payment service under the PS Act. However, persons who buy or sell Worldcoin accounts and tokens as a business may be providing a payment service.” He further explained that illegally sold Worldcoin accounts and tokens could be exploited for illicit activities, including money laundering and terrorism financing.
Global Regulatory Scrutiny
Worldcoin’s data collection practices, particularly its iris biometric system, have drawn significant attention from regulators worldwide. In 2023, authorities in India, South Korea, Kenya, Germany, and Brazil paused the collection of iris data and launched investigations into Worldcoin’s methods. These countries are scrutinizing the potential privacy and security implications of the company’s data practices.
European regulators have also raised concerns, citing potential violations of the General Data Protection Regulation (GDPR). Notably, on March 18, Spain became the first country to impose a ban on Worldcoin’s biometric data collection. Despite these regulatory challenges, Worldcoin has continued to expand aggressively, reporting over 10 million users by April 16.
Singapore’s Response to Unauthorized Sales
On August 7, the Singapore police issued a warning to the public against “giving away or selling their Worldcoin accounts,” as stated by Yong during the parliamentary meeting. He highlighted the risks associated with Worldcoin’s data collection practices, advising consumers to be cautious of inducements to transfer access to their digital payment token wallets or World ID. Such transfers could lead to misuse of personal data by third parties.
Yong emphasized that organizations handling sensitive personal information, including biometric data, must comply with Singapore’s data protection and security regulations. These measures are crucial to prevent related criminal activities and safeguard individuals’ personal information.
| Country | Action Taken | Date |
|---|---|---|
| India | Pause on iris data collection and investigation | 2023 |
| South Korea | Pause on iris data collection and investigation | 2023 |
| Kenya | Pause on iris data collection and investigation | 2023 |
| Germany | Pause on iris data collection and investigation | 2023 |
| Brazil | Pause on iris data collection and investigation | 2023 |
| Spain | Ban on biometric data collection | March 18, 2024 |
The ongoing investigation into Worldcoin’s practices and the global regulatory response highlight the increasing concern over data privacy and security in the digital age. As cryptocurrency projects and biometric technologies become more integrated into financial systems and daily life, the need for stringent regulatory oversight grows.
Regulators worldwide are grappling with the balance between fostering innovation and protecting individual rights. The scrutiny of Worldcoin serves as a case study in how emerging technologies intersect with existing legal frameworks and the challenges associated with regulating digital assets.
The investigation into Worldcoin by Singaporean authorities underscores the complexities involved in regulating cryptocurrency and biometric data collection. As the global community continues to address the implications of these technologies, ongoing vigilance and adaptation of regulatory measures will be essential in safeguarding against misuse and protecting public interests.
Featured image credit: Jnzl’s Photos via Flickr
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