Source: Cointelegraph
Original: “The U.S. Sounds Alarm Over OpenAI's Crypto Project World”

World Network, a digital identity and crypto project under Sam Altman’s OpenAI, has raised alarms among privacy advocates as it prepares to enter the U.S. market, with observers expressing deep concerns over its data collection and protection measures.

Nick Almond, CEO of FactoryDAO, bluntly stated on the X platform that World "is completely contrary to the concept of privacy protection; it is a trap." Despite the project claiming to protect user privacy in an era of increasing AI prevalence, it has faced a series of severe regulatory questions globally.

The iris-scanning technology and its crypto token reward mechanism, originally named "Worldcoin," are under investigation by authorities in India, South Korea, Italy, Colombia, Argentina, Portugal, Kenya, and Indonesia. In Spain, Hong Kong, and Brazil, the project has been explicitly banned.

World's latest entry into the U.S. market may pose the biggest challenge for CEO Sam Altman, as the complexity of privacy issues is further amplified by the inconsistent law enforcement standards across states.

On April 30, Altman announced that World would establish bases in five "key innovation centers" in the U.S.: Atlanta, Austin, Los Angeles, Miami, Nashville, and San Francisco. Users wishing to verify their identity can undergo iris scans at these centers, providing World with unique biomedical identifiers.

According to World, these identifiers can be used to prove users' human identity when interacting on digital platforms.

However, as World expands in the U.S. market, the uncertain regulatory environment may deter potential users and pose challenges in building user trust for the platform.

Andrew Rossow, a lawyer specializing in internet and public affairs at Rossow Law Firm, told Cointelegraph, "There is currently no comprehensive federal law in the U.S. specifically regulating biometric data (such as iris scans)."

In fact, relevant laws vary by state. The two states where World will operate—Texas and California—already have some form of legal protection for biometric data. Users in the other three states (Georgia, Tennessee, and Florida) must rely on federal law, which only requires that "companies must remain transparent and fair, but there are no specific state-level regulations for iris scans."

However, even with state laws, adequate protection cannot be guaranteed. In Texas, there is no private right of action for biometric data—only the state attorney general (AG) can enforce the state's Biometric Identifier Capture or Use Act.

Rossow pointed out, "For World, the effectiveness of user data protection almost entirely depends on the priorities, resources, and willingness to enforce of the Texas Attorney General."

A more proactive attorney general may provide stronger protections, while "a less active administration may deprioritize enforcement, leaving consumers in a vulnerable position susceptible to exploitation."

This potential risk of exploitation is one of the key factors driving activists to oppose systems like World.

Privacy advocacy organization Privacy International has supported legal action against World in Kenya, emphasizing that "biometric technology poses a serious threat to privacy and personal security in the absence of a strong legal framework and strict safeguards, as its applications could extend to facilitating discrimination, profiling, and mass surveillance."

As early as 2021, Amnesty International expressed concerns about the discriminatory and questionable methods of biometric systems. They noted that these systems "can infer and predict people's gender, emotions, or other personal attributes, with serious fundamental flaws in their scientific basis. This means that the inferences they make about us are often invalid, and in some cases, they even put eugenics theories like phrenology and physiognomy into practice."

Not everyone agrees with the concerns of privacy oversight agencies. Tomasz Stańczak, co-executive director of the Ethereum Foundation, stated that he has spent "over 100 hours" analyzing World, which is built on the Ethereum network. He added that the project "looks very promising, stronger and more privacy-focused than my initial intuition."

Ethereum researcher and scholar Paul Dylan-Ennis expressed his belief that World’s technology "could be quite strong in terms of privacy," but acknowledged that its overall atmosphere might be off-putting: "There is an overall intangible 'Black Mirror' feeling."

While OpenAI may be ramping up its strategy in the U.S. market, other jurisdictions around the world are intensifying investigations, restrictions, or outright bans on the company's activities.

In 2023, regulators in India, South Korea, Kenya, Germany, and Brazil began investigating the company's data collection practices. In March 2024, Spain became the first country to impose a comprehensive ban on World’s data collection.

The Spanish Data Protection Agency previously told Cointelegraph that its actions were based on reports from Spanish citizens. The agency stated that the Orb operator "provided insufficient information, collected data from minors, and even did not allow users to withdraw consent."

Following the ban, World issued a blog post stating that it operates "in compliance with the law in all operational regions."

Global regulators have taken a contrary stance. In May 2024, Hong Kong followed Spain's lead and ordered World to cease operations, citing violations of the region's Personal Data Privacy Ordinance.

Subsequent allegations of improper data collection emerged, with countries like Germany and recently Kenya ordering World to delete thousands of users' data, while Colombia and Argentina imposed hefty fines.

In January 2025, Brazil's National Data Protection Authority imposed a comprehensive ban on World, citing concerns over the irreversibility of data collection and the possibility that World might use cryptocurrency rewards to entice economically vulnerable groups to provide personal data.

Despite facing resistance in multiple countries, this identity system is making progress in certain markets. In Japan, World has become part of the online dating scene.

Spencer Rascoff, CEO of Match Group (which owns the dating app Tinder), announced on May 1 that Tinder would trial World’s identity verification system in Japan, "providing users with a privacy-first way to prove they are real humans."

In Japan, Tinder users can swipe right to match with users verified by World ID. Source: World

This integration has not yet been fully rolled out in Japan, but since Tinder is the most popular dating app in the country, it provides a significant application scenario for World’s identity platform. In 2024 alone, its downloads reached approximately 1.38 million.

If World can secure a partnership with Tinder in the U.S., it would gain 7.8 million monthly active users overnight. If it further expands to similar services like Bumble or Hinge—ranked second and third in the U.S. dating app market—World would capture 67% of the U.S. online dating market, holding unique personal identity information for tens of millions of users.

However, privacy rights protection in the U.S. is far from settled. In Texas, where World plans to operate, Google recently paid $1.4 billion in a settlement. The company made this substantial payment to Texas to resolve two lawsuits that accused it of tracking users' search and location data, as well as collecting facial recognition information.

Meanwhile, biometric companies are facing legal challenges in Illinois and New York, while lawmakers are taking steps to limit the collection of biometric data.

Related: Semler Scientific's stock price fell in after-hours trading due to a significant decline in first-quarter revenue.

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