Privacy Invasion in Chile? Major Crypto Company Faces Government Action

• SERNAC issues formal notice to World and Rappi in Chile to stop iris scanning over privacy concerns.
• Rappi confirms iris scanning project is only a pilot in Argentina, not Chile; aims to clarify confusion.

In Chile, the National Consumer Service (SERNAC) has issued a formal notice to the company World (formerly Worldcoin) and Rappi to halt iris scanning activities in the country. This decision is part of efforts to protect consumers from potential violations of the Consumer Protection Law and personal data breaches. 

The controversy arose following World’s announcement of plans to scan irises as part of a payment system, which raised significant privacy concerns among the public.

A consumer, who was a minor at the time of the complaint, said:

“In August 2022, on the beach, some guys at a Worldcoin stand offered me to create an account on their app to earn free cryptocurrencies. I agreed to use my personal data and scan my iris, but I was never informed that, if I decided to close my account, my data and iris would remain in the system. Today, when I became aware of the situation, it seems even more serious to me, since I was a minor and I was never informed of this.” This case highlights the lack of clarity and adequate measures for the protection of the rights of minors.

Rappi clarified that the iris scanning initiative is only being piloted in Argentina in 2024, not in Chile as previously speculated. Despite Rappi’s clarification, SERNAC continues to monitor World’s operations closely, demanding transparency about the use and protection of biometric data from both companies involved.

Following previous reports on CNF, The scrutiny increased after World announced plans not only to continue iris scans at fixed locations but also to introduce home visits for such activities in Latin America, potentially expanding through Rappi’s network. 

Another complaint states that:

Worldcoin offers money in exchange for scanning people’s irises, without fulfilling what was promised. “The company offers 30 thousand pesos to those who enter the application by scanning their eye. However, the money never arrives, and it seems that they are only stealing our data. It is very dangerous that a company is allowed to operate in this way, without anyone controlling what they do with that information.

This move prompted SERNAC to investigate further, leading to a preventive action to potentially cease World’s operations in Chile until compliance with data protection regulations can be demonstrated.

SERNAC’s proactive stance underscores the growing regulatory focus on digital privacy and the use of biometric data. The agency has emphasized the importance of informed consent and the specific disclosure of how such personal data will be utilized, principles that World appeared to overlook according to SERNAC’s findings.

The situation highlights the broader challenges and public concerns associated with the use of biometric data for commercial purposes. 

As crypto identification systems become more prevalent, the need for strict regulatory oversight becomes increasingly apparent, ensuring that consumer rights and privacy are adequately protected in the evolving crypto market.

Worldcoin (WLD) is currently trading at $1.97, with a slight daily decrease of 0.53%. Over the past week, it has dropped by 1.40%, but it has gained 1.96% over the past month, reflecting moderate recovery amidst previous downtrends.

The trading volume in the last 24 hours is $260.59 million, indicating consistent market interest. Key resistance is at $2.10, where recent attempts at a breakout were rejected, while immediate support lies around $1.90.

The price pattern and technical indicators suggest caution, as the prolonged downtrend may continue if WLD fails to break above $2.10.