Worldcoin is facing a $1.2 million fine in Argentina due to violations of law

In an unfolding drama, Worldcoin, known for its pioneering but controversial biometric data collection, is now facing legal hurdles in Argentina, adding to its ongoing challenges in Portugal and Spain. Authorities in Buenos Aires have launched a stern indictment against the protocol, founded by Sam Altman, citing grave discrepancies in the contractual agreements and the mishandling of personal data.

The Provincial Directorate for the Defense of Consumer Rights spearheaded the investigation, exposing the inclusion of what are termed "abusive clauses" in Worldcoin's contracts. These clauses allegedly contravene the National Consumer Protection Law, raising alarms over user rights and data security.

Concerns Over Data Transparency

Ariel Aguilar, the Undersecretary for Commercial Development and Promotion of Investments, has voiced concerns regarding the opaque nature of Worldcoin's data processing operations. Questions linger about whether the biometric data—specifically iris and facial scans collected via the company's Orb technology—is stored persistently or deleted post-collection. Further complicating matters, it is reported that the data might be stored across borders in Brazil.

Regulatory Findings and Violations

The investigation unearthed multiple infractions concerning the 'Terms and Conditions of Use,' 'Privacy Notice,' and 'Data Consent Form.' Notably, the company failed to clearly display the age restriction of 18, potentially leading to the unauthorized collection of minors' data. Moreover, the contracts imposed restrictions like waiving rights to collective legal action and adhering to foreign laws, specifically from the Cayman Islands, with disputes settled in California—a clear violation of Argentina's Civil and Commercial Code.

Market Reaction Contrasts Legal Woes

Despite the intensifying legal scrutiny and the general downturn in the market, Worldcoin's native token, WLD, has seen an unexpected rise of 2.6% in the past day, trading at $4.80. However, this uptick contrasts sharply with a significant 58% plummet from its peak price, highlighting the volatile nature of cryptocurrency markets and the complex interplay between legal issues and market dynamics.