China Raises Concerns Over Iris-Scan Crypto Projects

Highlights:

• China’s MSS warns that biometric data in crypto projects risks privacy and security globally.
• Sam Altman’s World uses iris scans for user verification but faces scrutiny in China.
• WLD’s price dropped 1.56% after biometric data concerns were raised by Chinese authorities.

China’s Ministry of State Security (MSS) has warned about the growing use of biometric data in crypto projects. In a notice shared on Wednesday, officials said technologies like facial, fingerprint, and especially iris scans are being used to collect sensitive user data through crypto-related activities. The ministry explained that collecting such sensitive data could harm personal privacy and might even create national security risks, especially if the data is stored or transferred outside of China.

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China's Ministry of State Security has publicly warned that a foreign company is using the issuance of cryptocurrency tokens as a gimmick to scan and collect user iris information worldwide and transfer the data source, posing a threat to personal information security and even…

— Wu Blockchain (@WuBlockchain) August 6, 2025

MSS Warning Targets Sam Altman’s World Project Using Iris Scan Verification

While the MSS did not mention any specific project by name, the warning appears to be aimed at Sam Altman’s World. Previously known as Worldcoin, World is known for using iris scans to verify users. After verification, users get a “World ID” to prove they are real people online. In exchange, they might receive cryptocurrency. The company’s website states that it has operated in 160 countries, but China is not included among them.

World is now available in the US. Thank you to the wonderful humans who joined us to celebrate. pic.twitter.com/2pubky0Pns

— World (@worldcoin) June 4, 2025

The MSS bulletin pointed out that iris scans are very sensitive because they are precise and unique. These scans are often used in defense and law enforcement. Unlike passwords, biometric data like iris patterns cannot be changed if stolen. Officials warned that foreign groups could misuse poorly stored facial and iris data. They mentioned past cases where fake facial images were used for spying. The MSS advised Chinese people to be careful when giving out biometric data. They also said it is much harder to recover from biometric data leaks than from other types of identity theft.

The ministry did not propose new regulations. However, its statements reflect growing concern in China’s security agencies about digital identity technologies and cross-border data transfers. Following the news about iris scan use in crypto, WLD’s price fell by 1.56%, while its trading volume decreased by 2.42% in the last 24 hours. Currently, WLD is trading at $0.9442.

Growing Concerns Over Biometric Privacy and Crypto Identity Systems

The discussion about biometric privacy is increasing in the blockchain world. Ethereum co-founder Vitalik Buterin shared a new idea called “pluralistic identity” to help stop spying and control. In June, he said that both central ID systems and strict one-person-one-ID plans reduce user privacy. These systems, like in projects such as World, make people less anonymous online. Buterin suggested a flexible way to verify people using different sources like governments, DAOs, or communities. He said this method can protect privacy while stopping fake accounts in decentralized systems.

this is quite accurate but are social graphs actually feasible in the real world for identity? One thing not mentioned is how easy it is to game them. The UX of attesting is also onerous and most regular users will not participate in social graph / web of trust ID for that…

— Nanak Nihal Khalsa 🔜🐈‍⬛ (@NanakNihal) June 28, 2025

World has faced questions from regulators in Germany, Kenya, and France. Authorities worry that users may not fully understand what sharing their biometric data means. They also have concerns about data safety and the risk of surveillance.

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