China is not happy with crypto projects using biometric data, and they’re making their feelings known. The Ministry of State Security (MSS) issued a stern warning about the growing use of biometric recognition technologies like facial, fingerprint, and iris scanning in crypto-linked projects. Apparently, these techs, often sold as tools to distribute digital assets, may actually be putting personal privacy and even national security at risk.
In a public security bulletin released on Wednesday, the MSS revealed some serious concerns. They cited an unnamed overseas company that allegedly scanned and collected users' iris data worldwide, all in exchange for their cryptocurrency tokens. The catch? The collected data was then transferred somewhere, raising serious red flags about the safety of personal information.
The mystery company? Well, it seems like they're pointing the finger at Sam Altman’s World, which has been scooping up iris data in exchange for its World (WLD) token. It’s been up and running in 160 countries, except for China, of course. But that didn’t stop the MSS from taking aim at these types of data-collecting schemes, warning that iris recognition is one of the most sensitive and irreversible biometric data types. Once compromised, it’s game over, there’s no changing your iris scan.
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
Facial Recognition
The MSS also called out facial recognition technology as another major risk. Improper storage of this sensitive data could lead to massive leaks, not only jeopardizing personal privacy but also threatening national security. There are even reports of foreign intelligence agencies manipulating facial recognition data for espionage. Apparently, infiltrating sensitive workplaces and conducting surveillance is much easier when you can fake someone’s face.
While biometric tech might seem like a dream for convenience (no more passwords, anyone?), the bulletin concluded with a big reminder: don’t get too comfortable. Be cautious when providing your personal biometric info because, once it’s out there, it’s incredibly hard to take back.
Pluralistic Digital ID for Privacy Protection
Meanwhile, Vitalik Buterin, the co-founder of Ethereum, has his own solution to the digital identity problem. In June, he proposed the idea of a pluralistic identity system to ensure privacy and inclusivity in digital identification. According to Vitalik, even privacy-focused systems like zero-knowledge (ZK) proofs could cause issues if they require one trackable ID for each person. This could ultimately destroy pseudonymity and lead to government or employer surveillance.
He’s not a fan of "proof of wealth" either; he argues it unfairly benefits the rich and excludes others. Instead, Buterin supports a pluralistic approach to identity, where verification comes from multiple sources, governments, social networks, or community-driven systems, without giving any single source total control.
Gunel Ismayilova
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