Chinese Biometric Data Exploited Through Crypto Schemes, Authorities Allege

After the recent news of China casting a blanket ban on crypto, a Chinese security minister has warned that foreign companies are using dubious crypto schemes to collect biometric data, including iris scans, calling this practice a threat to national security and the violation of personal privacy.

As per an article published on 6 August 2025 by the local news outlet Global Times, the Chinese ministry has highlighted growing concerns regarding biometric technology, citing recent cases in which foreign intelligence agencies unlawfully extracted facial data from individuals in China for espionage purposes.

Although the ministry hasn’t dropped any names, the outlined methodology shared by the authorities closely resembles Worldcoin’s approach, a crypto startup co-founded by OpenAI’s CEO Sam Altman.

China warns iris-scanning crypto projects pose national security threat. Read more on our article. https://t.co/3xQI6hrN7N

— Coin Headlines (@coinheadline) August 6, 2025

For those who don’t know, World, previously known as Worldcoin, offers crypto tokens to its users in exchange for their iris scans. The founders launched the startup intending to use biometric processes to verify unique identities and expand digital financial access, especially in underserved regions.

According to the ministry, an unnamed foreign firm leveraged crypto token distribution to gather vast amounts of iris data from users around the world. Once gathered, the information was sent overseas.

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Chinese Officials Expand On Growing Risk Of Biometric Data Leaks

The publication noted that biometric identification technologies, known for their speed and accuracy, have gained mass acceptance in the last couple of years. Further, the officials noted that while these technologies are convenient, they store and process facial features, fingerprints, irises and in some cases, body movements. With more and more people using this technology, the risk of a data breach has only increased.

To make their point, Chinese officials mentioned cases where foreign operatives manipulated biometric data to get access to sensitive information or penetrate secure facilities. Case in point, they mentioned a fingerprint-based payment system connected to a corporate database that suffered constant security breaches because of weak cybersecurity protocols, resulting in significant data exposure.

Additionally, the ministry emphasised that iris patterns are especially sensitive owing to their stability and resistance to duplication, which makes them ideal for authentication in high-security settings.

However, because of their uniqueness, they are also lucrative targets for cybercriminals.

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Authorities Advise Citizens To Monitor Their Data Closely 

With biometric technology gaining traction across various industries, ranging from financial services to immigration, China’s Ministry of Public Security has issued an advisory urging citizens to be more vigilant in this matter.

In its advisory, the ministry has advised citizens to exercise caution when submitting biometric data, especially for services involving facial scans, fingerprints or iris recognition.

It further emphasised that citizens can demand transparency from data collectors about how they store, process, and utilise personal information, encouraged them to thoroughly review privacy policies, and cautioned them against signs of overreach in data collection practices.

Notably, no new regulatory measures have been introduced so far regarding this matter.

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