Spain Blocks Worldcoin Project Over Data Privacy Concerns, WLD Token Slides 7%

The cryptocurrency project Worldcoin, spearheaded by Sam Altman, has faced another setback as Spain takes steps to block the venture. The Spanish data protection regulator, AEPD, has ordered Worldcoin to immediately halt the collection of personal information within the country and cease using the data it has already gathered. 

According to a Financial Times report, the AEPD expressed concerns about the project’s use of an eyeball-scanning “orb” to collect customers’ data. The regulator is expected to announce a “precautionary measure” on Wednesday, and Worldcoin has been given 72 hours to demonstrate compliance with the order.

Worldcoin, co-founded by Altman in 2019, has offered its cryptocurrency tokens to individuals worldwide in exchange for consent to scan their eyes with an orb. The scans serve as a means of identification, aiming to establish a reliable mechanism to distinguish between humans and machines as artificial intelligence advances. 

However, the Spanish regulator’s action adds to a series of setbacks faced by Altman and his co-founders, Max Novendstern and Alex Blania, who have encountered resistance in various countries.

Last year, Worldcoin faced opposition from authorities in Kenya, resulting in an order to cease operations. Additionally, the project refrained from launching its crypto tokens in the United States due to the country’s stringent regulations on digital assets. 

The report further notes that major global markets such as China and India have also not made the Worldcoin token available. The UK’s Information Commissioner’s Office had also expressed intentions to investigate Worldcoin.

While some jurisdictions have questioned the viability of Worldcoin’s cryptocurrency token, Spain’s recent action specifically targets the project’s core objective of establishing a method to verify customers’ “personhood.” Altman acknowledged the possibility of Worldcoin existing without its in-house cryptocurrency, as the start-up faces growing scrutiny.

Worldcoin has reportedly registered approximately 4 million users, and investments totaling around $250 million have come from venture capital firms such as Andreessen Horowitz and Khosla Ventures and prominent individuals like Reid Hoffman and Sam Bankman-Fried. 

The project gained media attention and sparked consumer complaints in Spain, particularly as queues formed at shopping center stands where Worldcoin offered cryptocurrency in exchange for eye scans.

In January, the data protection watchdog in Spain’s Basque Country, known as AVPD, warned about the eye-scanning technology used by Worldcoin in a mall in Bilbao. 

The AVPD deemed it subject to biometric data protection rules and called for a risk assessment. As a result of Spain’s regulatory action, the native token of Worldcoin, WLD, has experienced a 7% decline within the past 24 hours.

Worldcoin’s native token, WLD, has halted its 200% upward trend over the past 30 days as the focus shifts to Bitcoin (BTC), which recently achieved a new all-time high (ATH) on Tuesday. Despite the significant uptrend in the past month, WLD has experienced a 5.8% price correction in the last seven days.

Furthermore, the token’s market capitalization has slipped below the $1 billion mark and currently stands at $997 million. However, the advancements in artificial intelligence (AI) technology developed by Sam Altman’s projects hold the potential to influence the token’s price in the future significantly. 

Despite being down by 26% from its ATH of $9.44, the ongoing technological advancements in this field indicate that the token’s prospects remain promising.

Moving forward, it remains to be seen how the project’s founders will respond to the regulatory measures taken in Spain and how these actions will ultimately impact the token’s future price trajectory.

Featured image from Shutterstock, chart from TradingView.com