Why Worldcoin was hit with a one-year ban in Kenya and what it could mean

The tension between the identity verification project, Worldcoin and Kenya has taken another interesting dimension. The latest development is that the constituted committee that was set up to look into the activities of Worldcoin in Kenya has recommended a one-year ban for the project, per a local media report. 

Recall that the last month has been full of upheavals for Worldcoin, especially in the East African country. We reported how Worldcoin activities (scanning of irises in exchange for $WLD tokens) were suspended, how Kenyan police raided the Worldcoin office in Nairobi and how a committee was set up to investigate the affairs of the Sam Altman-founded project in the nation. With Worldcoin banned in the country, a whole new set of issues have been presented for its founders to deal with.

Related post: Worldcoin gets new signup every 9 secs in Argentina

Note that statistics show that out of 2.2 million Worldcoin registered users globally, Kenyans constitute around 600,000 or roughly 25%. This shows that the country is one of its largest markets.

Worldcoin banned for one year in Kenya 

According to Kenyan Data Commissioner, Immaculate Kassait while speaking before a Parliamentary Ad-hoc committee probing Worldcoin activities in Kenya on Thursday, the team formed to probe Worldcoin activities in the country has recommended a one-year suspension of its operations in the country.

Kenya news publication, The Star reports that the probe was carried out by the Office of Data Protection Commissioner in conjunction with agencies like the Communications Authority of Kenya, the Central Bank of Kenya, the Ministry of ICT and the National Computer and Cybercrime Coordination Committee.

Per the report, Immaculate Kassait said that with Worldcoin banned, it means the freeze on any further collection of data from Kenyans by Worldcoin will remain in force until it complies with specified conditions.

“The company will be allowed to operate once it allows for a security audit, allows the government access to the data, registers with the Business Registration Services (BRS), as well as establishes a local representative. It will also be required to carry out a Data Protection Impact Assessment (DPIA) and simplify consent and provide clarity on data storage.”

According to Immaculate, the consent procured from Kenyans for the capturing and storage of their data was insufficient and not in compliance with the provisions of the Data Protection Act.

“The purposes of collection of personal data varied and included the provision of World ID, provision of Worldcoin, development of, training and testing machine learning models.”

The Office of Data Protection Commissioner (ODPC) has now been mandated to press administrative fines on companies doing commercial activities on data collection which is considered a threat to national security and the economy.

“KRA to monitor the identified companies for payment of income tax on income from cryptocurrency in accordance to the Finance Act, 2023.” Immaculate said.

Also, operational licenses that Worldcoin claimed to possess have been revoked on the recommendations of the Adhoc committee. Additionally, the committee suggested that Worldcoin operators seek approval from the Capital Markets Authority (CMA) which will test its products, solutions and services before rollout to the Kenyan populace. 

Pending the approval of Worldcoin by these agencies, all Worldapps (mobile applications of the Worldcoin project) would be removed from Kenyan App stores for one year. 

Worldcoin banned: What does this mean?

Kenya has been at the center of the controversy regarding Worldcoin since the launch of the project. Recall that the scanning of iris by Worldcoin Orbs in different locations in exchange for $WLD tokens resulted in a craze weeks ago and the authorities had to step in.

Related post: Less than 2 months after launch, 98.5% of Worldcoin token investors already at a loss

This new update will stall Worldcoin activities in Kenya to a halt, at least for the next one year. All scanning centres would be placed on hold for now and with the removal of the Worldcoin app from app stores, usage of the ID project in the country will be reduced. Citizens can however continue to buy and trade the $WLD token on exchanges like Binance.

If those new recommendations by the committee are implemented, it could shape the way other countries decide to implement regulations around Worldcoin. Note that major countries like the United Kingdom, Germany, Argentina and a few others have already announced investigations into the project.