- Kenya and Indonesia take legal action against Worldcoin over data privacy and licensing violations.
- WLD token drops over 5% as regulatory pressure mounts and investor confidence wavers.
- Court orders Worldcoin to erase biometric data collected in Kenya within seven days.
OpenAI CEO Sam Altman backed cryptocurrency initiative Worldcoin is being hit with escalating legal scrutiny in Africa and Southeast Asia, putting a halt to its global expansion.
The company has faced damning verdicts delivered by courts and authorities in Kenya and Indonesia in the space of just 48 hours, sending its native token WLD into a tailspin. On May 5, 2025, Kenya’s High Court ruled that Worldcoin’s efforts in Kenya to collect data are ‘unlawful’ citing the country’s Data Protection Act of 2019.
Indonesia Suspends Worldcoin Over Licensing Issues
In response, Justice Aburili Roselyne ruled that because the company practiced scanning and storing biometric data specifically iris and facial scan in exchange for cryptocurrency, it was a breach of legal norms on the practice of obtaining informed consent.
Still, the court ruled that such consent was invalid because it was not ‘voluntary’ and was obtained through the offering of a relatively small sum of cryptocurrency, equivalent to about 7,000 Kenyan shillings.
Kenya has ordered Worldcoin to erase all biometric data it collected within Kenyan borders since its inception, permanently, within seven days. The deletion will be supervised by the country’s Data Protection Commissioner to check on compliance.
The challenge was brought by Nairobi based Katiba Institute, a prominent civil society organization worried by the country’s mass data harvesting carried out during chaotic registration drives that attracted huge crowds and caused public anxiety.
Indonesia’s Ministry of Communications and Digital (Komdigi) reinforced Worldcoin’s woes, suspending its local operation on the previous day. But authorities also found the company worked with two Indonesian entities PT Terang Bulan Abadi and PT Sandina Abadi Nusantara that were either operating without proper licenses or were leading with misrepresentation as they were illegitimate.
Using identity of another legal entity and operating without valid certification is a serious offence, the commander of state migration police, Akmetjomuru Komdigi, said in the statement. Meanwhile, the minister encouraged the citizens to report similar cases and vowed to boost oversight of digital service providers for protection of the public trust.
Worldcoin Faces Cross-Border Data Challenges
The actions have rattled investor confidence, coming back to back. WLD token, native to the worldcoin, fell more than 5%, trading up to $0.89 from the 24 hour high of $0,96. Meanwhile, open interest in the token also dipped, falling to $219 million as uncertainty rose around the project’s legal footing.
The setbacks come at a particularly damaging time for WLD, which had just rolled out WLD ID, a digital identity system in the U.S., which analysts have said is a bullish pivot. And Coinbase had reportedly been working to list the token, a prospect that could have brought far more attention to it.
The core of the controversy is the way that Worldcoin will employ “Orbs” futuristic devices that would scan a person’s irises to create a specific digital identity. Although pitched as a landmark development toward improving people’s ability to interact with financial systems, it has alerted privacy authorities and regulators.
With WLD finding its way forward, the company is at a crucial inflection point. The dual regulatory pushback signals the struggles of scaling biometric based technologies across jurisdictions with divergent legal framework and cultural differences on data privacy.
Caught in a legal, ethical and financial storm, Worldcoin is under mounting pressure in key markets and seeing its value fall. It will be interesting to see whether it can come through it all with its credibility still intact.
