German privacy watchdog has been investigating Worldcoin since November 2022

One of Germany’s top privacy regulators began investigating Worldcoin’s data collection practices in November 2022, and the probe is still ongoing, Reuters reported on July 31.

The Bavarian State Office for Data Protection Supervision President Michael Will told the newswire that the regulator had concerns over the project’s aim to process “sensitive data at a very large scale.”

Will said that the German watchdog is leading the investigation into Worldcoin’s data collection and storage practices under European data protection rules because Tools for Humanity — the company behind the Worldcoin project — has a subsidiary in the country.

He added that several other European authorities are also interested in Worldcoin and have made requests for information as it falls under the German regulator’s direct oversight.

Privacy protections

Open AI founder Sam Altman created Worldcoin and aims to become a decentralized “identity and financial network.” It launched on July 24 along with 1500 physical “orbs” in multiple cities around the world that aim to scan people’s eyes to create a unique Worldcoin ID. Those who participate are given 25 Worldcoin as a reward and a unique identification on the network.

The orbs have raised significant concerns in Europe due to its strict data protection rules, and regulators in multiple countries are probing the project to ensure that its collection and storage of data meets the continent’s stringent standards.

Privacy regulators in the U.K. and France have launched their own investigations into Worldcoin, with the latter collaborating with its German counterpart.

Many of the worries center around whether the data is stored securely and whether participants gave explicit consent for the collection of sensitive biometric data. Additionally, regulators are concerned about the soundness and security of the technology itself.

Will told the newswire:

“These technologies are at first sight neither established nor well analyzed for the specific core purpose of the processing in the field of transferring financial information.”

According to the project’s website and whitepaper, it stores the data it collects in encrypted form and uses zero-knowledge proof technology for verification purposes.

Worldcoin previously told CryptoSlate that it fully was fully compliant with European data rules and was supervised by the Bavarian State Office for Data Protection Supervision. It is unclear whether the project is aware of the ongoing investigation by the German regulator.

Worldcoin and Tools for Humanity did not respond to a request for comment as of press time.

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