Indonesian Regulators Suspend World's Operations Over Compliance Concerns
2min read Indonesian regulators have suspended the operations of World, a blockchain startup co-founded by Sam Altman, CEO of OpenAI. The suspension comes after reports of suspicious activities and concerns over the project's compliance with electronic system operation regulations. The project, which offers users small payments of its crypto token (WLD) in exchange for scanning their biometric data via one of its Orb devices, has been under scrutiny for potential violations of personal data protection laws.
The suspension was announced by Alexander Sabar, Director General of Digital Space Supervision. Sabar stated that the move was a preventive measure to prevent potential risks to the community. The official announcement alleged that the Indonesian subsidiary operating World in the country—PT Terang Bulan Abadi—has not been properly registered as an Electronic System Organizer (PSE), and did not have the Electronic System Organizer Registration Certificate (TDPSE) required by Indonesian law as a result. The announcement claims World used a TDPSE in the name of another legal entity, PT Sandina Abadi Nusantara. Both legal entities have been summoned by the regulator to provide clarification on the alleged violations.
Ask Aime: What impact will the suspension of World's operations by Indonesian regulators have on the blockchain and crypto market?
This isn’t the first time that regulators have clamped down on World's activities. In December last year, German regulators ordered the firm to implement a GDPR-compliant data deletion protocol. A month later, Brazil's National Data Protection Authority (ANPD) levied a ban on the company from operating in the country, claiming its payouts could influence consumer behavior in unfair ways. The start-up was banned for just under a year in Kenya, with local politicians criticizing its business practices and even calling the company “a gang of criminals,” before it resumed operations in June 2024.
Despite these setbacks, World has continued to expand its operations. The firm has rolled out its service in six major American cities: Atlanta, Austin, Los Angeles, Miami, Nashville, and San Francisco. Additionally, World has integrated its services with several major companies, including Tinder owner match group and prediction market Kalshi, along with a visa card and charges for applications using World ID services.
The suspension of World in Indonesia highlights the growing scrutiny that emerging technologies face, particularly those involving biometric data. The decision underscores the need for strict compliance with data protection laws and the importance of safeguarding sensitive biometric information. As more countries grapple with the implications of decentralized finance and biometric technology, the need for robust regulatory frameworks becomes increasingly apparent. The Indonesian government's actions serve as a reminder that emerging technologies must prioritize user privacy and legal compliance to gain public trust and regulatory approval.
The suspension of World and WorldID services in Indonesia is part of a broader trend of increased regulatory scrutiny on cryptocurrency projects globally. As the project awaits further clarity on applicable permits and licenses, it remains to be seen how World will address the concerns raised by Indonesian authorities and the public. The outcome of this regulatory scrutiny will have implications for the future of biometric-based cryptocurrency projects and the broader digital economy.
