On August 6th, China’s Ministry of State Security warned that using biometric data for rewards poses a national security risk.
The agency pointed to a foreign firm that paid users in cryptocurrency to scan their irises, and their data was then sent overseas.
The ministry claimed on its official WeChat account and said the practice could harm personal privacy and state safety.
Worldcoin Faces Implicit Accusations
Though unnamed, the firm described matches Worldcoin. The crypto project was co-founded by OpenAI CEO Sam Altman. Worldcoin offers its WLD tokens in exchange for an iris scan with the goal of building a global identity network.
Regulators in Germany, France, and Kenya have already raised concerns. They fear weak consent standards, unclear data storage rules, and potential surveillance.
Beijing’s notice went further by warning about stolen facial data. The ministry said foreign spies can use such data to craft deepfake identities.
Those fake faces could help agents slip into secure sites. The security service said this trend undercuts both individual rights and national defences.
Balance Between Innovation and Security
China now stands at a crossroads between tech growth and privacy protection. Biometric tools can make services more secure and user-friendly. Yet they also carry risks if data falls into the wrong hands.
Lawmakers and firms must work out clear rules on collection, storage, and cross-border transfers. Without safeguards, users may lose trust in both fintech and government controls.
China’s JD.com Moves into Stablecoins
In a related development, China’s e-commerce giant JD.com registered two new subsidiaries for digital coins.
The units are called Jcoin and Joycoin, under its JD Coinlink Technology arm, and the filings pave the way for JD.com to issue stablecoins. This move comes just days before Hong Kong opens under its new stablecoin rules.
JD.com’s push follows several big players seeking a crypto license in Asia. The firm hopes its stablecoins will tap into faster payments and lower fees. It also aims to offer users more choice in how they spend online.
At the same time, China’s regulators are sending mixed signals. On one hand, they warn about data risks, and on the other hand, they allow corporate experiments with digital assets.
Also Read: China’s Kuaishou Employees Sentenced for $20 Million Embezzlement and Crypto Laundering