Brazil upholds ban on cryptocurrency rewards for World ID biometric data

Brazil’s data protection agency (ANDP) has upheld its decision to limit cryptocurrency compensation related to the World ID project due to excessive concerns over users’ privacy. 

The National Data Protection Authority of Brazil (ANDP) stated on March 25 that it is not going to revoke the ban on the financial incentives for users who share biometric data for World ID. This comes after the agency carried out an investigation into the much-debated project that seeks to use iris imaging to assign identification numbers to users. ANDP also underscores that the financial compensation in Worldcoin (WLD) of any World ID generated through the use of the iris scans in Brazil must remain frozen.

Despite requesting ANDP review the ban, Tools for Humanity, which develops the World ID, did not approve the petition. If it continues to collect data, the company now faces a fine of 50,000 Brazilian reais, or approximately $8,800 per day.

In a translated version, the announcement noted:

“(i) the solutions presented by the regulated entity do not meet the ANPD’s determination, since the financial consideration for the collection of sensitive personal data is still characterized; and (ii) the change in the legal hypothesis of consent in the present case is not admissible.”

Concerns over privacy and consent

ANDP started investigating the World ID project in November 2024 because the provision of monetary rewards could distort users’ decisions to share their biometrics. The project, previously called ‘Worldcoin,’ enables users to generate a World ID through iris scans. The scans create a digital passport that allows users to prove their identities when engaging in online activities.

While it is part of the global trend toward the creation of digital ID solutions, the Brazilian data protection agencies have expressed concerns regarding the collection, storage, and usage of biometrics. Another concern raised by the ANDP was that, through the use of incentives, the users may be pressured to provide their consent. 

According to Brazilian law, consent to process biometric data must be “free, informed, and unequivocal,” and the processing of sensitive data must follow all privacy regulations. ANDP also expressed concern over the impossibility of users deleting their data once it is collected, an aspect that shows the irreversibility of information collection.

Besides the World ID controversy, Brazil is increasingly regulating stablecoins, which are another key part of the cryptocurrency industry. The country’s central bank has recently discussed imposing measures to limit stablecoins to self-custody wallets due to possible money laundering and tax evasion.  This proposal has raised concerns, especially from players like Coinbase, who believe these regulations could potentially stifle innovation and force businesses to go towards less transparent jurisdictions.

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