The Ministry of State Security of China warns foreign encryption companies about the threat of iris data collection.

August 6, 2025 - The Chinese Ministry of National Security issued a warning, stating that a foreign company, under the guise of issuing crypto assets tokens, is collecting iris data globally, posing a serious threat to personal information security and even national security. This move has triggered market fluctuations and heightened concerns over biometric data privacy.

Worldcoin is suspected of illegally collecting iris data.

The Chinese Ministry of State Security has specifically named a foreign entity called "World Network" (also known as "Worldcoin"), stating that it widely collects users' iris data under the guise of issuing Crypto Assets. Worldcoin was co-founded by well-known figures, including OpenAI CEO Sam Altman, and its actions of generating digital identities and issuing Token through iris scanning technology have raised significant concerns from Chinese authorities.

The Ministry of State Security stated in a declaration: "A foreign company, under the pretext of issuing Crypto Assets Tokens, scans and collects the iris data of global users, posing a threat to personal information security and even national security." Iris data, as high-precision biometric information, has uniqueness and immutability. Once leaked, it may be used for identity theft or intelligence collection, threatening personal privacy and national security.

The contradiction between privacy issues and data localization is intensifying.

In recent years, China has continuously strengthened its data security and privacy protection efforts. The "Data Security Law" and the "Personal Information Protection Law" clearly require that the storage and processing of sensitive data (such as biometric data) must comply with strict localization requirements. In addition, China's recently launched centralized internet identity recognition system further emphasizes the standardization of digital identity and localized data management. The iris data collection behavior of Worldcoin is in obvious conflict with China's stringent data sovereignty policies.

The warning from the Ministry of State Security reflects China's ongoing concern over the cross-border data transmission by foreign entities. Although the statement did not disclose the latest developments regarding Worldcoin, analysts point out that this incident may prompt China to tighten regulations on the collection of biometric data further.

Global regulation and market response

China is not the first country to question the data collection practices of Worldcoin. Previously, several countries, including France and Kenya, have launched investigations into Worldcoin's operations, focusing on whether it infringes on user privacy. The Coincu research team pointed out that the re-evaluation of digital identity recognition practices by various countries may drive the introduction of stricter regulatory measures globally.

As a result of this news, the price of Worldcoin's WLD Token has experienced fluctuations. The market's demand for transparency in privacy protocols is growing urgent, and Worldcoin and its founder Sam Altman have yet to make an official response to this matter. The Crypto Assets community and government agencies are closely monitoring the developments, and it is expected that biometric technology-based Crypto Assets projects will seek a new balance between innovation and security regulation.

Broader industry impact

According to the "2025 Cryptocurrency Crime Report" released by Chainalysis, the application of biometric data in the field of crypto assets is raising alarms among global regulatory agencies. The collection of highly sensitive information such as iris data not only involves personal privacy but may also be used for illegal purposes, such as money laundering or identity fraud. Regulatory agencies in various countries may take this opportunity to redefine the boundaries between crypto asset innovation and data security.

The warning from China's Ministry of State Security highlights the sensitivity of biometric data in the global digital economy. As the controversy surrounding Worldcoin's iris data collection continues to escalate, the global Crypto Assets industry may face stricter privacy scrutiny. In the future, businesses must pay more attention to data security and compliance while promoting technological innovation to cope with the increasingly complex regulatory environment.