Spain bans Worldcoin for up to three months amid broader investigation

Worldcoin has been banned in Spain for up to three months as the country’s data protection watchdog continues its investigation into the cryptocurrency project co-founded by Sam Altman.

In a statement on Wednesday, Spanish data protection agency AEPD announced that it has ordered a precautionary measure against Tools for Humanity Corporation. The company, the core developer behind Worldcoin, has a business model that involves scanning people’s irises in exchange for cryptocurrency.

“The AEPD has received several complaints against this company about insufficient information, the collection of data from minors and the fact that consent cannot be withdrawn, among other infringements,” the regulator said. 

The agency ordered the project to cease the collection and processing of personal data and to stop using the information already collected. The Spanish regulator added that the processing of biometric data, which merits special protection under the European Union’s General Data Protection Regulation (GDPR), entails high risks for people’s rights.

In response to the temporary ban, Worldcoin said in a blog post that it has been engaged with the Bavarian data protection authority, which is leading supervisory efforts for GDPR compliance, for over a year.

“It is unfortunate that the Spanish data protection authority (AEPD) is circumventing established procedures under GDPR with their actions today, which are limited to Spain and not the broader EU,” Jannick Preiwisch, data protection officer of the Worldcoin Foundation, said in the statement.

Preiwisch added that the Worldcoin team’s efforts to communicate with the AEPD had “gone unanswered for months.”

“We are grateful to now have the opportunity to help the AEPD better understand the important facts regarding this essential and lawful technology,” Preiwisch continued.

Worldcoin’s WLD token dropped to as low as $6.08 at one stage on Wednesday but later rebounded to $7.79 at 10:15 a.m. on Thursday Hong Kong time, according to The Block’s Price Page. The token was up 23.7% over the past 24 hours.

Heightened regulatory scrutiny

Worldcoin has faced investigations in various jurisdictions for its business practice that involves scanning people’s irises. Earlier this week, South Korea launched an investigation on Worldcoin after receiving complaints about the project.

In January, Hong Kong’s privacy watchdog conducted investigations at six Worldcoin premises, citing concerns regarding risks to personal data privacy. Following the launch of Worldcoin's token in July, the UK's data protection regulator announced its intention to inquire into the project. In the same month, Bavaria's State Office for Data Protection Supervision also said it was looking into the crypto project.

In August 2023, Kenya’s Ministry of the Interior suspended Worldcoin from operating in the country, after the project had already registered hundreds of thousands of individuals.