Key Points
- South Korea’s Personal Information Protection Commission (PIPC) has fined Worldcoin and Tools For Humanity a total of 1.1 billion Korean won ($830,000) for violations in collecting and transferring personal data.
- Tools For Humanity welcomed the decision, stating that the identified weaknesses have been remedied and viewing it as confirmation that their operations, including the use of the Orb for humanness verification, are compliant with South Korean law.
PIPC’s Findings and Penalties
South Korea’s Personal Information Protection Commission (PIPC) has imposed significant fines on Worldcoin and its development firm, Tools For Humanity (TFH), for alleged violations of local privacy laws. The total penalty amounts to 1.1 billion Korean won ($830,000), with the Worldcoin Foundation bearing the brunt of the fine at 725 million won ($545,000) and TFH facing a 379 million won ($285,133) penalty.
The PIPC’s investigation, which began in February 2024, uncovered several issues:
- Inadequate notification: The Worldcoin Foundation failed to properly inform subjects about the purpose of collecting and the retention period for their scanned iris data.
- Language barrier: Prior to March 22, the project did not provide a Korean translation of its biometric data consent form.
- Insufficient information disclosure: Both entities failed to inform subjects about the country where personal information would be transferred and the name and contact information of the recipient, as required by local law.
- Lack of data deletion option: The foundation did not provide a mechanism for subjects to request the deletion of their iris data.
- Age verification issues: TFH did not adequately verify the age of signees under 14 until April 2024.
Despite these violations, the PIPC did not ban the collection of sensitive data in South Korea, provided Worldcoin addresses the identified issues.
Worldcoin’s Response and Project Overview
Tools For Humanity, in a press release, welcomed the PIPC’s decision. The company stated that the investigation “effectively concludes that TFH’s operations, including the use of the orb for humanness verification, are in compliance with South Korea’s Personal Information Protection Act.” TFH acknowledged the weaknesses in their original disclosures when launching in South Korea but emphasized that these issues have since been remedied.
Worldcoin, a project under Tools For Humanity, was co-founded by Alex Blania and OpenAI CEO Sam Altman. The project’s primary objective is to assign “World IDs” to individuals who scan their irises on an Orb device, aiming to prove humanness and protect people from potential negative impacts of AI. According to the project’s website, participants receive WLD cryptocurrencies, and Worldcoin has verified over 6.7 million World IDs across more than 160 countries worldwide.
Implications and Future Outlook
This regulatory action by South Korea’s PIPC highlights the growing scrutiny faced by crypto and digital identity projects, particularly those handling sensitive biometric data. While the fines are substantial, Worldcoin and TFH’s positive reception of the decision suggests that they view this as a step towards regulatory clarity and compliance in the South Korean market.
The outcome of this investigation may set a precedent for how similar projects operate in South Korea and potentially influence regulations in other jurisdictions. As Worldcoin continues to expand globally, it will likely face ongoing challenges in navigating the complex landscape of international data protection laws.
