Worldcoin to make Argentina a regional hub despite looming regulatory risks

Worldcoin is planning to make Argentina a regional hub for its business. The company is planning to invest in expanding operations in the country just as its president Javier Milei is pitching to make Argentina “the world’s fourth AI hub” with a hands-off approach to regulation.

Worldcoin’s plans include hiring at least 50 IT staff and opening 50 Worldcoin locations in more than 10 cities across the country over the summer. The company offers users cryptocurrency in exchange for an iris scan and the creation of a “World ID,” a digital identity that Worldcoin describes as a “private digital passport that differentiates humans from bots online.”

The company’s move towards Argentina comes amid increasing regulatory scrutiny over its collection of sensitive biometric data, including legal challenges, warnings and potential penalties threatening its business around the world.

President Milei is hoping to solve Argentina’s economic crisis and soaring inflation by deregulating the economy, including drawing investment from global tech businesses seeking to avoid regulatory risks in the U.S. and Europe. Last month, his government held high-profile meetings with Google, Apple, Meta as well as OpenAI’s Sam Altman, the founder of Worldcoin.

The Worldcoin project has also found popularity in Argentina. Each month, more than a million Argentinians use its crypto wallet World App, according to the firm. Some part of this success, however, may lie in users trading in biometrics for cryptocurrency as a solution to inflation and unemployment.

Worldcoin’s regulatory safety in Argentina, however, seems far from secure.

Milei holds a minority government and upcoming regulation designed to incentivize investment and loosen up AI rules is still dependent on the decision of the country’s Senate, according to the Financial Times. Argentinian government agencies and lawmakers have also been making moves against the crypto firm.

In August 2023, the Agency for Access to Public Information (AAIP) opened an investigation against the firm and formed a working group on Worldcoin with other countries within the Ibero-American Data Protection Network (RIPD). In April of this year, the province of Buenos Aires charged the company for including “abusive clauses” in its customer agreements, threatening it with a fine of up to US$1.15 million.

More recently, Buenos Aires parliament member Carlos Puglelli proposed a regulatory framework for iris scanning and establishing a Provincial Registry of Digital Applications of Biometric Data.

Argentina does not have a specific law governing AI but it regulates data use through the Personal Data Protection Law. The country also issued a National Artificial Intelligence Plan of 2019, highlighting ethical and legal principles, as well as other initiatives such as the inter-ministerial committee on AI, which promises regulatory frameworks to minimize the unwanted impacts of the technology.

Article Topics

Argentina  |  biometrics  |  digital ID  |  iris biometrics  |  proof of personhood  |  World  |  World ID  |  World ID Orb